Key Telecom Headlines: We have incorporated recent market feedback
into our estimates for the Turkish Telecom sector. The revision favors Turk
Telekom and we have made further adjustments to 2009/2010 and beyond.
For Turk Telekom we expect Avea’s revenue growth to clock 22% in 2Q09
versus 10.4% in 1Q09, and estimate that by 4Q09, mobile revenues could be
growing again by 50.3% oya, resulting in consolidated revenue growth of
10.1% in 4Q09. We believe 2Q09 is unlikely to bring progress in mobile
margins due to the strong growth, but we believe an improvement is likely
in 2H09 on lower MTRs. We estimate that over 2009/2012, mobile alone
should lift consolidated EBITDA at Turk Telekom by 25%, accounting for
c.70% of the company’s growth. We are reiterating our preference for Turk
Telekom based on growth adjusted valuation and operating momentum, and
we believe that growth in mobile should drive outperformance in upcoming
quarters, especially if as we expect mobile margins improve in 2H09. We
have updated our medium-term earnings estimates and valuation for Telkom
SA, following FY09 final results. At the current market valuation and using
our EV calculation, both P/E and EV/EBITDA forward ratings appear
attractive. However, we believe both execution and forecasting remain key
risk elements, and as a result, Telkom should in our view continue to trade at
a discount of at least 30% to its peer group. The key differentiating factor
that drives the Telkom investment story, in our view, is wholly owned
Nigerian telco Multi-Links which will in our view be the swing-factor for
the stock. Recent newswire and press stories regarding consolidation and
funding activity in the Russian telecom sector should have positive
implications for Comstar and Sistema, in our view, but be neutral for MTS.
We maintain our favorable view on the Russian mobile sector, for which we
expect earnings to surprise to the upside in the next few quarters and believe
valuations remain very attractive.
• Telecom Performance and Valuation Backdrop: The top performers this
week have been Comstar, Magyar Telecom and Telefonica O2 Czech
Republic with the bottom performers being Orascom, Sistema and Turkcell.
• Media Performance and Valuation Backdrop: The top performing media
stocks this week have been TVN and Naspers while the bottom performers
have been RBC and Dogan.
• Top Picks: Our top picks are Vimpelcom, Turk Telekom, CTC Media,
Naspers and MTN.

Table of Contents
Key Sector Views and Top Picks ............................................3
Key Investment Themes ..........................................................6
Secular Outlook — Telecoms..................................................7
Secular Outlook — Media ........................................................9
Price Targets...........................................................................10
Stock Investment Theses ......................................................11
Earnings Calendar..................................................................15
Key Telecom News and Research of the Week ...................16
Key Media News and Research of the Week........................21
Media: Audience Developments............................................24
Valuation: Multiples................................................................25
Valuation: DCF Valuations.....................................................27
AFK Sistema ...........................................................................28
Key Company Projections .....................................................34
Please see the relevant research report, or the most recent company-specific
research published by J.P. Morgan for important disclosures, including a discussion
of valuation and risks, for any security recommended herein before forming any
investment opinion whatsoever. J.P. Morgan research is available at
http://www.morganmarkets.com, or you can contact the covering analysts or your
J.P. Morgan representative.