Strong Mobile Networks momentum but some near-term some margin headwinds Nokia showed strong Mobile Networks momentum with ccy growth of +12% y/y, beating consensus expectations by +8% with strength driven primarily by North America. Mobile Networks Margins were also ~90bps ahead, driving the segment EBIT beat of +20%. Demand environment remains favourable amidst macro uncertainty, with the company still expecting Mobile Networks market growth with further market share gains in 2023. Near-term demand is also supported by upcoming India 5G roll-outs which is expected to ramp aggressively in a short space of time. Management has cautioned near-term gross margins impact from mix shift away from North America and also the initial roll-out phase in India. However, longer term the scale benefits from capturing the Indian market should offset the margin dilution post the initial roll-out phase. There was also some catch-up sales in Q3 with easing supply chain which should also continue into Q4 and into 1H23. Strong execution and pricing power amidst supply chain and inflation Nokia has maintained its strong execution in Q3, and continues to see an easing situation in supply chain which is expected to be mostly resolved by 1H23. The company has also won a reference Hyperscaler customer in IP routing which should support revenues as deployment ramps. Despite the inflationary environment, Nokia has demonstrated pricing power with operating margins continuing to perform well. Remain Outperform on strong execution and discounted valuation Despite the external challenges and Technologies negotiation and litigation, Nokia has been executing well on supply chain components sourcing and inflationary pricing. We make small changes to revenues and operating margins, valuing Nokia at FY24e ~7.5x adj. EV/EBIT (down from ~8x) discounted back. We lower our TP from EUR5.9 to EUR5.8 (ADR price lowered to USD5.7). We remain Outperform on Nokia from strong execution and...