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TLS $3.15

Vodafone <VOD.L> fell 6.1 percent


    96 Posts.

    The benchmark index <.FTSE> shed 86.6 points or 1.9 percent
    to 4,460.2 by 0845 GMT, having fallen three percent in the
    previous session in a slide which wiped 33 billion pounds off
    blue-chip shares.

    Vodafone fell 6.1 percent, hitting 4-1/2 year lows
    amid industry accounting concerns. It tumbled on Tuesday as
    investors mulled the prospect it may buy Vivendi
    assets if that company decides to sell parts of the business.

    "Any company that's been big in acquisitions recently,
    especially among TMTs, is a suspect on the accounting front, and
    particularly if it's big like Vodafone because it's more
    difficult to tell exactly what they've done," said one senior banker.
    TLS is the one of most expensive Telcom in the world in term of P/E.( 16 Vs average 13.5).

    TLS spend $3.5Bn~$4Bn on so called 'operation capital expenditure' each year, most of them more likely are the expense rather than the capital expenditure.

    in 2000, operation capital expenditure is $4.729 Bn
    in 2001, operation capital expenditure is $4.059 Bn
    in 2002, operation capital expenditure is expected at $3.7 Bn.

    In my view these money which are spent on Switching, Transmisssion, Customer access are expense for the maintenance, are the cost for the business to stay on.

    If these items treated as expense rather than capital expenditure, tls's P/E is over 25!

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