China Telecom (0728) AI Stock Analysis

• Market Cap: €649.91B
• Dividend Yield: 5.24%
• Average Volume (3M): 81.77M
• Price to Earnings (P/E): 13.8
• Beta (1Y): 0.33
• Revenue Growth: 0.53%
• EPS Growth: 5.28%
• Country: HK
• Employees: 277,674
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 0.09
• Shares Outstanding: 13,877,410,000
• 10 Day Avg. Volume: 86,724,038
• 30 Day Avg. Volume: 81,766,991
• PEG Ratio: 1.40
• Price to Book (P/B): 0.93
• Price to Sales (P/S): 0.79
• P/FCF Ratio: 7.63
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €7.51
• Price Target Upside: 33.15% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: HK$6.50 ▲(15.25% Upside)

China Telecom's strong financial performance, characterized by robust revenue growth and efficient cost management, is the most significant factor contributing to the score. The technical analysis indicates neutral market conditions, while the valuation is fair with an attractive dividend yield. The absence of earnings call data and corporate events does not impact the overall assessment.

China Telecom Business Overview & Revenue Model

Company Description

China Telecom Corporation Limited, listed under the ticker 0728, is a leading telecommunications operator in China, providing a comprehensive range of services including fixed-line and mobile telecommunications, broadband internet services, and data communication solutions. With a focus on integrating advanced technologies, the company also offers value-added services such as cloud computing, Internet of Things (IoT), and integrated information services, catering to both individual consumers and enterprises across various sectors.

How the Company Makes Money

China Telecom generates revenue primarily through its core telecommunications services, which include mobile voice services, data services, and broadband internet access. The mobile segment contributes significantly to the overall revenue, driven by the growing demand for mobile data and services. Additionally, the company earns income from fixed-line services, which include traditional telephony and broadband services. Another key revenue stream is from value-added services, such as cloud services, IoT solutions, and multimedia content services, which have seen increased uptake as businesses and consumers seek more integrated digital solutions. China Telecom also benefits from strategic partnerships with technology firms and local governments, enabling it to expand its service offerings and enhance operational efficiencies. The company's revenue model is further supported by its extensive customer base and ongoing investments in network infrastructure to improve service quality and coverage.

China Telecom Financial Statement Overview

Summary

China Telecom exhibits strong financial health with impressive revenue growth and efficient cost management. The balance sheet is solid with low leverage, and cash flow generation is robust, supporting future growth. While profitability margins are stable, there is potential for improvement in net profit margins.

Income Statement

China Telecom shows strong revenue growth with a TTM increase of 46.2%, indicating robust market demand and expansion. The gross profit margin has improved significantly to 39.7% in TTM, reflecting efficient cost management. However, the net profit margin remains modest at 6.4%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are stable, indicating consistent operational performance.

Balance Sheet

The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.15, indicating prudent financial leverage. Return on equity is solid at 7.5%, showing effective use of shareholder funds. The equity ratio is stable, reflecting a strong capital structure. However, the gradual increase in total debt warrants monitoring to ensure continued financial stability.

Cash Flow

Operating cash flow remains strong, supporting a high operating cash flow to net income ratio of 0.41. Free cash flow growth is positive at 11.4% in TTM, demonstrating effective cash management. The free cash flow to net income ratio of 0.39 indicates good cash conversion, although slightly lower than previous periods. Overall, cash flow generation is robust, supporting future investments and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	531.73B	529.42B	507.84B	481.45B	439.55B	393.56B
Gross Profit	179.29B	150.07B	146.41B	249.09B	230.16B	208.06B
EBITDA	120.46B	127.81B	141.45B	113.59B	102.45B	104.12B
Net Income	32.33B	33.01B	30.45B	27.59B	25.95B	20.86B
Balance Sheet
Total Assets	887.22B	866.63B	835.81B	807.70B	762.23B	715.10B
Cash, Cash Equivalents and Short-Term Investments	110.57B	102.01B	91.85B	76.30B	75.21B	33.09B
Total Debt	69.18B	60.74B	65.19B	77.38B	58.90B	93.99B
Total Liabilities	413.21B	410.07B	388.65B	371.27B	331.07B	348.92B
Stockholders Equity	466.87B	452.39B	442.93B	432.09B	428.67B	363.46B
Cash Flow
Free Cash Flow	49.57B	55.00B	47.34B	44.92B	52.36B	43.29B
Operating Cash Flow	138.06B	145.27B	137.51B	136.43B	137.53B	132.26B
Investing Cash Flow	-113.20B	-101.29B	-95.49B	-96.80B	-80.29B	-87.08B
Financing Cash Flow	-34.51B	-42.90B	-33.48B	-40.91B	-7.52B	-42.11B

China Telecom Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 5.64
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0728, the sentiment is Negative. The current price of 5.64 is below the 20-day moving average (MA) of 5.87, below the 50-day MA of 5.70, and above the 200-day MA of 5.63, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 36.80 is Neutral, neither overbought nor oversold. The STOCH value of 6.52 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:0728.

China Telecom Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0728	76 Outperform	€649.91B	13.81	7.66%	5.24%	0.53%	5.28%
0552	76 Outperform	$33.59B	8.63	8.00%	5.08%	1.54%	-2.09%
1883	73 Outperform	HK$9.44B	10.30	8.67%	7.37%	-0.62%	-5.10%
0788	72 Outperform	$184.72B	16.35	5.62%	3.93%	3.24%	8.66%
6823	72 Outperform	$87.02B	16.89	14.75%	2.88%	2.33%	2.41%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
0008	49 Neutral	HK$42.86B	-151.37	―	1.64%	4.26%	36.68%

China Telecom Corporate Events

China Telecom Announces Extraordinary General Meeting for Governance Changes

China Telecom Corporation Limited has announced an Extraordinary General Meeting (EGM) scheduled for December 16, 2025, in Beijing, to discuss and vote on several significant resolutions. Key proposals include amendments to the Articles of Association, the abolition of the Supervisory Committee, and changes to the Rules of Procedures for both the Shareholders’ Meeting and the Board of Directors. Additionally, the election of Mr. Lee Sunny Wai Kwong as an Independent Non-Executive Director and his remuneration package will be considered. These changes are expected to impact the company’s governance structure and strategic direction, potentially influencing its market positioning and stakeholder relations.

China Telecom Announces H Shareholders’ Class Meeting for Key Resolutions

China Telecom Corporation Limited has announced a significant meeting for its H Shareholders, scheduled for December 16, 2025, in Beijing. The meeting will focus on special resolutions including amendments to the Articles of Association and the abolition of the Supervisory Committee. These changes could impact the company’s governance structure and operational procedures, reflecting a strategic shift in its corporate framework.

China Telecom Announces Board Changes with New Independent Director Appointment

China Telecom Corporation Limited announced the resignation of Mr. Yeung Chi Wai, Jason, as an Independent Non-Executive Director due to regulatory term limits. Mr. Yeung, who played a significant role in corporate governance, will be succeeded by Mr. Lee Sunny Wai Kwong, pending shareholder approval. Mr. Lee brings over 40 years of experience in business and technology management, and his appointment is expected to enhance the company’s board with his extensive expertise.

China Telecom Proposes Governance Changes Amid Regulatory Shifts

China Telecom has announced proposed amendments to its Articles of Association and the abolition of its Supervisory Committee in response to recent changes in Chinese corporate law and regulations. These changes are aimed at aligning with the new Company Law and regulatory requirements, which include the establishment of an audit committee to assume the functions of the Supervisory Committee. The proposed amendments will be subject to shareholder approval at upcoming meetings, reflecting the company’s efforts to streamline governance and comply with updated legal frameworks.

China Telecom Reports Stable Growth in 2025 Q3 Financial Results

China Telecom Corporation Limited reported its financial results for the first three quarters of 2025, showing a slight increase in operating revenues to RMB397.0 billion and a 5.0% rise in profit attributable to equity holders, reaching RMB30.8 billion. These results indicate a stable financial performance with a modest growth in profitability, reflecting the company’s ongoing efforts to enhance its service revenues and operational efficiency, which could positively impact its stakeholders and market positioning.

China Telecom Reports Strong Subscriber Growth in Q3 2025

China Telecom reported its key operating statistics for the third quarter of 2025, highlighting a net increase of 4.48 million mobile subscribers, bringing the total to 437.19 million. Notably, the company saw a significant growth in its 5G network subscribers, with a net increase of 10.39 million, reaching a total of 292.41 million. The expansion in both mobile and 5G subscribers underscores China Telecom’s ongoing efforts to strengthen its market presence and adapt to the growing demand for advanced network services.

China Telecom Schedules Board Meeting to Review Financial Results

China Telecom Corporation Limited has announced that its board of directors will meet on October 21, 2025, to approve the financial results for the nine months ending September 30, 2025. This meeting is crucial as it will provide insights into the company’s financial health and operational performance, potentially impacting its market positioning and stakeholder confidence.