RESEARCH IN MOTION (RIM) INVESTMENT PROPOSAL 2011The Giraffe GroupAlvin, Archish, Mandy, Jacquelin, Minh, Tung
CONTENT• Executive Summary• Company Overview and Competition in the Market• Financial Analysis• SWOT Analysis of Company Performance and Strategy• Ethical Position• Conclusion• Recommendation
EXECUTIVE SUMMARY• RIM is a multinational telecommunications company based in Canada, founded in 1984.• Most well known for the BlackBerry smartphone series.• Ranked as the No. 1 fastest-growing company in 2009.• One of the „Ten Best Companies to Work For in 2011‟.• Has good fundamentals and business operations.• Highly recommended for potential investors.
COMPANY OVERVIEW ANDCOMPETITION IN THE MARKETMarketing Mix – The Four P’s1.Product• Blackberry is characterised by its convenient communicating and networking function• The „BlackBerry Enterprise Server‟• The BlackBerry Messenger• The trademarked QWERTY keyboard
2. Place• Headquarter is located in Ontario, Canada.• Branches worldwide• Orders can be placed on the Blackberry website
3. Promotion• RIM has a high budget for promoting BlackBerry
DEMOGRAPHIC MARKET SEGMENTATION• RIM BlackBerry focuses on enterprise consumers as their security protection is reliable• The „BlackBerry Enterprise Solution‟ (BES) is the only smartphone system “approved for use with restricted data Government departments and organisations.”• The popularity of its design attracts young users.• The non-touchscreen feature is appropriate for elderly users.
GEOGRAPHIC MARKET SEGMENTATION Geographic Revenue Mix UK UK 10% 11% Canada Canada 5% US 7% 39% US Others 58% 27% Others 43% 2010 2011
UNIT SALES Research In Motion HTC Apple (iPhones) Year 2009 2010 2011 2009 2010 2009 2010 2011Revenue 9,090 14,593 19,907 4,786 9,234 13,033 25,600 47,100Units sold 26 36.7 52.3 11.7 24.7 20.7 40 72.3Unit sales 349.62 397.63 380.63 408.68 374.27 628.67 640 651.45
FINANCIAL ANALYSISIncome Statement Analysis: Gross Profit and Net Profit
FINANCIAL RATIOS Research In Ratio HTC Apple Motion Current Ratio 1.9 1.3 1.6 Liquidity Ratio 1.4 1.1 1.3 Gearing 0.1 0 1.5
FINANCIAL RATIOS Research In Ratio HTC Apple Motion Return On Assets 20.5% 21.9% 22.3% (ROA) Price-to-Earnings 3.2 6.4 13.5 Ratio
FINANCIAL RATIOS Research In Ratio HTC Apple Motion Gross Profit 46.4% 28.9% 42.2% Margin Net Profit Margin 16.01% 14.05% 23.95%
SWOT ANALYSISStrengths Weaknesses• Strong fundamentals • Strong competitors• Powerful brandings • Lack of creative applications• Excellent design• Developer zone
SWOT ANALYSISOpportunities Threats• Clientele expansion • Service failure• Advertising with famous people • New entrance and substitute• Asian focus
ETHICAL POSITIONEmployees Society• Free BlackBerry phones • Significant role in 2011 UK‟s riot• “Work, home and you” • Personal privacy is highly protected.• “Healthy @ RIM”
ETHICAL POSITIONPersonal privacy and security Environment• Largely invested in new security • No external verification for data technologies on greenhouse gas (GHG) emission• Cause monitoring difficulties to • Accused of not having a clean governments electricity plan • Did not set a target on reducing GHG emission
CONCLUSIONTaking all aspects of the company into account, we believe that Research InMotion Ltd has a very promising future. Although competition is very strong inthe telecommunications market, it has its own unique stance and clientele inthe market which will not be affected by developments of other companies.We expect to continue seeing many BlackBerry users both in business andpersonal.
RECOMMENDATIONInvest a significant amount of the portfolio in RIM andbuy their shares as soon as possible