Nokia’s (NYSE:NOK) stock held up nicely last week on the news that it will 3,500 jobs in various facilities around the world. However, this week the stock is slumping, and the main reason for this could be the upcoming Apple (NASDAQ:AAPL) event. In all probability, Apple could come out with a cheaper version of iPhone along with the iPhone 5. It could be an entirely new phone with different specifications or iPhone 4 and iPhone 3GS could act as a cheaper iPhone. We don’t know yet for sure, and whatever the case is, Nokia is in a precarious position as emerging markets are important for Nokia and account for about 37% of our $6.65 price estimate for Nokia stock.

See our complete analysis for Nokia stock here

Yesterday, we did the analysis on how a cheaper iPhone could hurt Research in Motion’s (NASDAQ:RIMM) stock as emerging markets are the only place where RIM has experienced meaningful revenue growth in recent quarters (see RIM’s Wild Ride Could Continue This Week). According to a Bloomberg report citing IDC estimates, Apple accounted for only 2.6% of India’s smartphone shipments in the quarter ended June 30, trailing RIM’s 15%, Samsung’s 21% and Nokia’s 46%.^[1]

In terms of mobile phone share in emerging markets, we expect Nokia’s market share to be around 27% by the end of 2011. This goes to show that although Nokia’s fortunes are declining, it still holds the edge in emerging markets like India.

Apple wants to penetrate emerging markets at some point

Nokia has also benefited from the fact that Apple has traditionally not concentrated much in expanding its operations in emerging markets like India. However, this time situation could be different and Apple might be wanting to gain from the large potential that emerging markets possesses.

Just to give you an idea about the emerging markets’ potential, China Telecom could begin offering iPhone by the end of this year in a deal that could represent a $9 billion opportunity for Apple (see Adding More China to iPhone Sales Gets Apple to $430).

Understand How a Company’s Products Impact its Stock Price at Trefis

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