US investment bank Merrill Lynch said on June 6, it was cutting its fair value on Russian wireless telecommunications provider Vimpelcom to $41 from $43 after the company posted lacklustre first quarter results last week and its management warned capital expenditure would remain high.
"What was unexpected and unwelcome was management's accompanying guidance that pricing will remain tough and capex will remain high," Merrill said in a research note.
Vimpelcom reported a profit of $109.7 million, or $2.14 per share, in the quarter ended March 31, up from $75.6 million, or $1.88 a share, last year. Revenue rose to $640.6 million from $413.8 million. It added nearly 4.2 million subscribers during the quarter.