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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: john t. brice who wrote (7143)	1/16/1999 12:57:00 PM
From: P. Ramamoorthy	Read Replies (2) \| Respond to of 27311

John - my reasoning. Revenue growth from the sale of batteries that come with the original equipment (cell phone or laptop, palm pilot) can be figured when estimating the total market size of Li Poly batteries and VLNC share of the market for each category of products. Although the battery is rechargeable, some may or may not buy a spare battery right away except the Lap top or Palm pilot customers who may prefer a spare battery. There is uncertainty in estimating "spare" battery sales and VLNC share of this market. Sales of batteries for replacement of original equipment is also uncertain. (It may go up or down depending upon how VLNC's batteries perform.) Since VLNC is using OEM's and secondary packagers at this time, there is no brand name recognition like Kodak films. Without the brand name recognition, it is difficult for me to figure how the product substitution market will add to or lower VLNC battery sales. Since the battery replacements will not occur in a year or two after the original equipment sale, we expect the replacement battery market/sales will have some time lag and will influence the rate of VLNC revenue growth. Conservatively, I am using only the new equipment for estimating VLNC's sales and revenue growth. Ram