CITIC International: Reiterate "Buy" Rating on China Telecom, Lower Target Price to HK$7.85

BOC International releases a research report reaffirming China Telecom (00728) as a “Buy” with a target price lowered from HKD 9.84 to HKD 7.85. The firm continues to view the company as the preferred stock among Chinese telecom operators, believing it benefits from improved earnings visibility and a solid shareholder return commitment, making its valuation attractive.

The company’s profit last year increased by 0.5% year-on-year, slightly below expectations, with service revenue growing only 0.7% year-on-year; capital expenditure decreased by 5.4%, with investment structure shifting more towards infrastructure. Despite the impact of the VAT increase, management remains confident in driving revenue and profit growth this year through token, intelligent computing centers, and cloud security businesses.

(Edited by: Wang Zhiqiang HF013)

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