James Lewis

China Mobile's Moat: Worth a Swim?

If the market in Hong Kong is strong or the Shanghai market strengthens and the perception shifts again to the buying China trade. What better stock to be long of. Unlike other 'STATE OWNED' companies the subsidisation of personal goals is really quite minimal. Who knows they may even try to sell 3G standard TD-SCDMA to some poor developing country eventually.

Also China Mobile has an almost Monopoly (not really even a Duopoly) over the Chinese Market and they are lots and lots of people. The culture is to use mobile phone (ranging from Migrant workers wanting to keep in touch with freinds all the way up to the chinese Models wanting to look safisticated and lets not forget Chinese Business People that like to shout orders down the phone in public to show 'face'). Not only that China Mobile has a better network of shops that any Bank and are making good money. Even though there reporting is for sure very suspect. Evern the ADR.

Its a good play if people want to trade 'the buy China trade'

The downside is the Government will use this company to maintain employment levels at any cost in the event of a downturn. However I dont see no downturn, quite the opposite. All I see is wage differential getting bigger and middle/upper class getting richer through asset inflation appreciation. No doubt there will be some more opression of the poor to limit political risk. But whats new?