NTT DoCoMo Target Raised - Analyst Blog
Supported by its new customer pricing plan, NTT DoCoMo, Inc. (DCM), the largest wireless service provider in Japan, declared respectable financial results for its first half of fiscal 2009 (ended September 30, 2008). The company's operating income increased 41% year-over-year, which offset a minor reduction in revenue.
DCM currently holds 51.5% share of the Japanese cellular market. The introduction of NTT DoCoMo's discount-priced service plans progressed as customer churn rates improved significantly. Stronger foreign currency rates, with respect to Yen against Dollar, have also raised valuation levels of DCM ADR shares.
Operationally, the company has upgraded 98% of its total coverage area with 3G HSDPA technologies and its emerging 4G LTE network is likely to be installed by 2010. We reiterate our Buy recommendation with a higher valuation target, as our assessment indicates improved financial performance due to technological superiority.
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