Research in motion (rim)

The Giraffe Group

Alvin, Archish, Mandy, Jacquelin, Minh, Tung

RESEARCH IN MOTION (RIM)INVESTMENT PROPOSAL 2011

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 AND COMPETITION IN THE MARKET

Marketing Mix – The Four P’s

1.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

• 4. Price

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

US58%

UK10%

Canada5%

Others27%

US39%

UK11%

Canada7%

Others43%

2010 2011

UNIT SALES

  Research In Motion HTC Apple (iPhones)

Year 2009 2010 2011 2009 2010 2009 2010 2011

Revenue 9,090 14,593 19,907 4,786 9,234 13,033 25,600 47,100

Units sold 26 36.7 52.3 11.7 24.7 20.7 40 72.3

Unit sales 349.62 397.63 380.63 408.68 374.27 628.67 640 651.45

FINANCIAL ANALYSIS

Income Statement Analysis: Gross Profit and Net Profit

FINANCIAL RATIOS

RatioResearch In

MotionHTC Apple

Current Ratio 1.9 1.3 1.6

Liquidity Ratio 1.4 1.1 1.3

Gearing 0.1 0 1.5

RatioResearch In

MotionHTC Apple

Return On Assets (ROA)

20.5% 21.9% 22.3%

Price-to-Earnings Ratio

3.2 6.4 13.5

FINANCIAL RATIOS

RatioResearch In

MotionHTC Apple

Gross Profit Margin

46.4% 28.9% 42.2%

Net Profit Margin 16.01% 14.05% 23.95%

FINANCIAL RATIOS

SWOT ANALYSIS

Strengths

• Strong fundamentals

• Powerful brandings

• Excellent design

• Developer zone

Weaknesses

• Strong competitors

• Lack of creative applications

SWOT ANALYSIS

Opportunities

• Clientele expansion

• Advertising with famous people

• Asian focus

Threats

• Service failure

• New entrance and substitute

ETHICAL POSITION

Employees

• Free BlackBerry phones

• “Work, home and you”

• “Healthy @ RIM”

Society

• Significant role in 2011 UK’s riot

• Personal privacy is highly

protected.

ETHICAL POSITION

Personal privacy and security

• Largely invested in new security

technologies

• Cause monitoring difficulties to

governments

Environment

• No external verification for data

on greenhouse gas (GHG)

emission

• Accused of not having a clean

electricity plan

• Did not set a target on reducing

GHG emission

CONCLUSION

Taking all aspects of the company into account, we believe that Research In

Motion Ltd has a very promising future. Although competition is very strong in

the telecommunications market, it has its own unique stance and clientele in

the market which will not be affected by developments of other companies.

We expect to continue seeing many BlackBerry users both in business and

personal.

RECOMMENDATION

Invest a significant amount of the portfolio in RIM and

buy their shares as soon as possible

BIBLIOGRAPHY

• http://money.cnn.com/magazines/fortune/fortunefastestgrowing/2009/snapshots/1.html

• http://www.eluta.ca/top-employer-rim