03.06.2001
Better outlook for D-Link

• D-Link (2332 'You Xun') has denied rumors it has already received OEM / ODM outsourcing orders from Cisco. D-Link claims it has been in talks with Cisco for the last couple of years, but has not agreed on anything of substance yet.

• We doubt that Cisco is really looking for another Taiwan OEM / ODM partner since it is already outsourcing to Accton (2345 'Zhi Bang').

• Things do not look too bad for D-Link in 2001. It reported February revenue of NT$1.3b and expects revenue of around NT$1.4b this month. With ongoing demand for new products like VoIP and anticipated cable modem shipment to Europe, we upgrade our recommendation on D-Link to ACCUMULATE from Hold. It is currently trading at a P/E of 19x.

BennyLo@Primasia.com +886-[0]2-2547-8869