The main business of New Sea Union (002089.SZ)  includes optical communication related products and software outsourcing at telecom value-added business. From January to September 2011, New Sea Union achieved operating revenue of RMB 544 million, up 52.11% YOY; net income of RMB 147 million, up 53.04% YOY.

In the aspect of optical communication, investment on construction of broadband access network has presented explosive growth in China in 2011, which will last for at least two years. Therefore, the sufficient orders assure steady growth of New Sea Union, of which growth rate hit 45% in 2011Q3. Meanwhile, gross margin of optical communication supporting business rose from 38.6% in the first half year to about 45%.

In terms of software outsourcing, New Sea Union has started staff expansion since the end of last year and has over 3,500 employees till Nov. 2011, up 30% against the previous year. In 2011Q3, its revenue reached RMB80 million, increasing by 36% approximately. As one of the six core software outsourcing vendors of HUAWEI, New Sea Union will directly benefit from HUAWEI’s informatization strategy and business expansion of enterprise network.

In addition, New Sea Union increased investment on LED projects, with the aim to develop new growth engine.