China Mobile Looks for Help in Handsets

China Mobile (NYSE: CHL; HKEx: 941), the world’s biggest mobile carrier and increasingly one of the world’s most boring companies, is trying to bring some zip back to its bottom line by selling phones. The company has just reported another quarter of snooze-worthy numbers that saw its profit rise a scant 3.7 percent — repeating a refrain from the last two to three years. (English article) The company, which has been loathe to promote its second-rate 3G service, keeps trying to wow the market with talk of 4G and how everything will get better then. But since that’s so far off — at least 3 years by most estimates — now it’s turning to cell phones as well to try and jazz up its bottom line, with its buy out of Topssion, a customerizer and distributor of handsets, from its former partners that included ZTE (HKEx: 763; Shenzhen: 000063) and Huawei. (English article) Topssion isn’t a company I’ve ever heard of, so don’t look for any results too quickly. But if China Mobile really puts its mind to this, especially given its huge clout in the handset market, this buy could still end up being a lucrative and much needed source of new income to boost its anemic bottom line.

Bottom line: China Mobile is in desperate need of more lucrative businesses to jump start its profit growth, and its purchase of a China-based handset company should help in that direction.