Goldman sachs said despite concerns about the first half results of Hong Kong-listed ZTE Corp, it is still expected to "meet or beat" revenue and earnings per share estimates over the period.

Goldman Sachs continues to rate ZTE at "buy."

It predicted that it would earn 19.9 bln yuan in revenues and 0.28 yuan in earnings per share for the first half.

While the company is firmly linked to China's commercially disappointing third-generation TD-SCDMA handset standard, "as long as China Mobile pushes it and the government pays the bill, ZTE should benefit handsomely, the note said.

It said that the sales of TD-SCDMA handsets at China Mobile outlets have been well below expectations, and it is "unlikely to become a commercially viable 3G technology due to its weak supply chain."

However, China Mobile is still pressing ahead with the technology and could build networks in all major cities in the fourth quarter of the year, according to media reports.

Goldman Sachs has set a target price of 43 hkd for ZTE's stock. It last traded at 34.85 hkd.

Source:XFN