The problem was pinpointed after about 100 Nokia handsets were found to have overheated while recharging, The Times of London reported Tuesday. The world's largest cell phone manufacturer issued its "product advisory" for BL-5C batteries supplied by Matsushita of Japan between December 2005 and November 2006.

While "no serious injuries or property damage" have been reported to have been caused by faulty batteries, a Nokia spokeswoman said it's possible a too-hot battery could damage a surface on which a handset was left.

Analysts said the bulk of the cost of replacing batteries will most likely be covered by Matsushita. As few as 5 percent of the total suspect units may actually be turned in by customers, which would leave the cost at $20 million to $40 million, one analyst estimated.