Lenovo grows like topsy -

Buyer of IBM knock-offs, Lenovo has been doing well at making what Big Blue could not make work, extremely profitable.

Lenovo Group which is now the world's fourth-biggest smartphone vendor, saw net profit grow 29 percent for the business year ended March, as strong smartphone sales helped shore up weak growth in China.

While many are seeing the end of smartphones, Lenovo is expanding into the area to offset a decline in its PCs to the extent that it agreed in January to buy the Motorola Mobility smartphone unit of Google for $2.9 billion.

Lenovo became a global brand in 2005 after buying the PC unit of IBM, and also bought Biggish Blue's low-end server unit for $2.3 billion as another way to combat slow PC sales.

Chief Executive Yang Yuanqing said the acquisitions would weigh on finances in the near term, but there is some concern that the trade spat between the US and China over cyber espionage on Monday will affect the acquisitions, as they are still subject to US regulatory scrutiny.

The acquisitions did not have an impact on net profit for the year through March, which rose 28.7 percent to $817.2 million, Lenovo said.

This was more or less in line with what the cocaine nose jobs of Wall Street predicted.

Revenue rose 14.3 percent to $38.7 billion and any weakness in China was off-set by growth in Europe, the Middle East and Africa (EMEA) and the Americas which is contrary to what other tech companies are experiencing.

"Lenovo's smartphone unit shipments achieved a record-high level of over 50 million for the fiscal year, growing by 72 percent year-on-year, driven by the strong growth in China and emerging markets outside of China," the company said in the statement.

However, things do not look good for Lenovo, at least for the near future. It may take at least until the end of 2014 to make the acquisitions profitable and the smartphone market is getting tougher.