CHINA TELECOM(00728.HK):STEADY 1Q2024 EARNINGS GROWTH;HIGH QUALITY DEVELOPMENT IS IN PROGRESS
CHINA TELECOM(00728.HK):STEADY 1Q2024 EARNINGS GROWTH;HIGH QUALITY DEVELOPMENT IS IN PROGRESS
We maintain China Telecom's (the "Company") TP at HK$5.00 and the investment rating as "Buy". Considering the steady improvement of its earnings and dividends, as well as the opportunities brought about by the rapid development of cloud business, we maintain the TP at HK$5.00 and the investment rating as "Buy". The TP represents 12.7x/ 11.7x/ 10.8x 2024-2026 PER. The corresponding dividend yield will be 5.7%/ 6.3%/ 7.0% in FY2024-FY2026.
我們將中國電信（“公司”）的目標價維持在5.00港元，投資評級爲 “買入”。考慮到其收益和股息的穩步改善，以及雲業務快速發展帶來的機遇，我們將目標價維持在5.00港元，投資評級爲 “買入”。目標股指2024-2026年市盈率爲12.7倍/11.7倍/10.8倍。在 FY2024-FY2026 中，相應的股息收益率將爲 5.7%/6.3%/7.0%。
China Telecom recorded steady earnings growth. In 1Q2024, the Company recorded service revenue and net profit of RMB124,347 million (+5.0% yoy) and RMB8,597 million (+7.7% yoy), respectively, in line with market expectations. In 1Q2024, number of mobile subscribers and wireline broadband subscribers increased by 3.88 million and 2.06 million, while mobile ARPU and broadband blended ARPU slightly rose by 0.9% and 2.1% yoy, respectively. Besides, due to its continuous investment in industrial digitalization, industrial digitalization revenue further increased by 10.6% yoy.
中國電信盈利穩步增長。在 1Q2024 中，該公司的服務收入和淨利潤分別爲人民幣1243.47億元（同比增長5.0％）和人民幣85.97億元（同比增長7.7％），符合市場預期。在 1Q2024 中，移動用戶和有線寬帶用戶數量增加了388萬和206萬，而移動ARPU和寬帶混合ARPU同比分別小幅增長了0.9％和2.1％。此外，由於其對工業數字化的持續投資，工業數字化收入同比進一步增長10.6％。
We expect that dividend payout will steadily grow over the next few years. Due to the steady growth of the main businesses and good control of operating expenses, we believe that the Company's net profit will continue to grow steadily in the coming years. The Company proposed to raise dividend payout ratio to over 75% within three years from 2024. Thus, we believe the dividend payout will steadily grow over the next few years. Based on the closing price as of 23 April 2024, the dividend yield for China Telecom in 2023 was 5.8%. Combined with stable profit growth, we expect that operators will continue to increase their dividend payout levels. Based on the closing price as of 23 April 2024, the estimated dividend yield for China Telecom in 2024/ 2025/ 2026 is expected to be 6.5%, 7.2%, and 8.0%, respectively.
我們預計，未來幾年股息支出將穩步增長。由於主營業務的穩定增長和對運營費用的良好控制，我們認爲公司的淨利潤在未來幾年將繼續穩步增長。該公司提議從2024年起的三年內將股息支付率提高到75％以上。因此，我們相信未來幾年股息支出將穩步增長。根據截至2024年4月23日的收盤價，中國電信在2023年的股息收益率爲5.8％。再加上穩定的利潤增長，我們預計運營商將繼續提高其股息支付水平。根據截至2024年4月23日的收盤價，中國電信在2024/ 2025/ 2026年的預計股息收益率將分別爲6.5％、7.2％和8.0％。
Catalysts: Increase in dividend payout and dividend payout ratio; promotion of cloud business.
催化劑：提高股息支付和股息支付率；促進雲業務。
Risks: Slower-than-expected growth of industrial digitalization business, mismatch between investments and benefits of industrial digitalization business.
風險：工業數字化業務的增長低於預期，工業數字化業務的投資與收益不匹配。
譯文內容由第三人軟體翻譯。