China Telecom (0728) AI Stock Analysis

• Market Cap: €711.20B
• Dividend Yield: 4.54%
• Average Volume (3M): 52.61M
• Price to Earnings (P/E): 15.9
• Beta (1Y): 0.37
• Revenue Growth: 1.35%
• EPS Growth: 5.43%
• Country: HK
• Employees: 277,674
• Sector: Communication Services
• Sector Strength: 90
• Industry: Telecommunications Services
• EPS (TTM): 0.08
• Shares Outstanding: 13,877,410,000
• 10 Day Avg. Volume: 58,310,407
• 30 Day Avg. Volume: 52,613,320
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: €6.99
• Price Target Upside: 12.33% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 75 Outperform
• Price Target: HK$6.50 ▲(4.50% Upside)

China Telecom's solid financial performance is the strongest factor, indicating strong operational efficiency and financial stability. Technical analysis shows mixed signals, with the stock facing slight resistance. The valuation is reasonable, offering a decent dividend yield. The absence of recent earnings call data and notable corporate events means these factors do not impact the score.

Positive Factors

Dividend Increase

Dividend hike to improve shareholder return, with a commitment to a 75% payout ratio by FY26.

Earnings Performance

The company’s solid first-quarter results, showing 3% year-over-year earnings growth, support the projection of 8% earnings growth and dividend growth.

Industrial Digitalisation Growth

The industrial digitalisation business is the key growth driver, with cloud and IDC revenue showing significant year-over-year growth.

Negative Factors

Market Competition

Irrational competition in the mobile market could lead to a price war, affecting revenue.

Policy Risks

China's telecom sector is exposed to policy risks, which could be unfavorable to business performance.

Telecom Sector Challenges

China's telecom sector faces policy risks, management changes, and tariff cuts, which could be unfavourable.

China Telecom Business Overview & Revenue Model

Company Description

China Telecom Corporation Limited, together with its subsidiaries, provides wireline and mobile telecommunications services primarily in the People's Republic of China. It offers wireline voice services, including local wireline telephone services and long-distance wireline services; CDMA mobile voice services, such as local calls, domestic and international long-distance calls, intra-provincial roaming, and inter-provincial and international roaming; wireline Internet access services comprising dial-up and broadband services; and wireline, Internet, and mobile value-added services. The company also provides integrated information application services consisting of Best Tone information services; and information technology-based integrated solutions, such as system integration, outsourcing, special advisory, information application, knowledge, and software development services. In addition, it offers managed data services that include digital data network, frame relay, and asynchronous transfer mode services for government agencies, large corporations, and institutions; and leased line services, as well as sells, repairs, and maintains customer-end equipment. Further, the company provides international telecommunications services; cloud products and services; and e-commerce, music production and related information, instant messenger, and capital and financial management services, as well as sells telecommunications terminals and equipment. As of December 31, 2021, it had approximately 372 million mobile subscribers; 170 million wireline broadband subscribers; and 107 million access lines in service. The company was incorporated in 2002 and is based in Wan Chai, Hong Kong. China Telecom Corporation Limited is a subsidiary of China Telecommunications Corporation.

How the Company Makes Money

China Telecom generates revenue primarily through its telecommunications services. Key revenue streams include mobile services, such as voice and data plans, broadband internet access, and fixed-line telephone services. Mobile services constitute a significant portion of their revenue, driven by a large subscriber base. Additionally, the company earns money from value-added services, such as cloud computing, data center services, and Internet of Things (IoT) solutions. Partnerships with other technology companies and government contracts further contribute to its earnings. The company's strategic investments in 5G technology and infrastructure also play a crucial role in its revenue generation, enabling it to offer improved services and capture new market opportunities in the evolving digital landscape.

China Telecom Financial Statement Overview

Summary

China Telecom has demonstrated strong financial performance with consistent revenue growth, robust profit margins, and efficient cash flow management. The balance sheet reflects low leverage and a strong equity base, contributing to financial stability.

Income Statement

China Telecom has demonstrated consistent revenue growth, with a 3.10% increase in Total Revenue from 2023 to 2024. Gross Profit Margin stands robust at approximately 28.7% for 2024. The Net Profit Margin improved to 6.30% in 2024 from 6.00% in 2023. EBIT and EBITDA margins are solid at 8.13% and 24.41%, respectively, reflecting strong operational efficiency.

Balance Sheet

The company's Debt-to-Equity Ratio is healthy at 0.13, indicating moderate leverage. Return on Equity (ROE) improved to 7.30% in 2024, showcasing enhanced equity profitability. The Equity Ratio remains strong at 52.20%, indicating a solid equity base relative to Total Assets.

Cash Flow

Free Cash Flow grew by 16.19% from 2023 to 2024, highlighting increased cash efficiency. The Operating Cash Flow to Net Income Ratio is robust at 4.40, demonstrating strong cash generation relative to net income. The Free Cash Flow to Net Income Ratio stands at 1.67, indicating efficient conversion of income into cash.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	523.57B	507.84B	474.97B	439.55B	393.56B
Gross Profit	150.07B	146.41B	135.09B	230.16B	208.06B
EBITDA	127.81B	141.45B	134.53B	129.24B	121.06B
Net Income	33.01B	30.45B	27.59B	25.95B	20.86B
Balance Sheet
Total Assets	866.63B	835.81B	807.70B	762.23B	715.10B
Cash, Cash Equivalents and Short-Term Investments	102.01B	91.85B	76.30B	75.21B	33.09B
Total Debt	60.74B	65.19B	77.38B	58.90B	93.99B
Total Liabilities	410.07B	388.65B	371.27B	331.07B	348.92B
Stockholders Equity	452.39B	442.93B	432.09B	428.67B	363.46B
Cash Flow
Free Cash Flow	55.00B	47.34B	44.92B	52.36B	43.29B
Operating Cash Flow	145.27B	137.51B	136.43B	137.53B	132.26B
Investing Cash Flow	-101.29B	-95.49B	-96.80B	-80.29B	-87.08B
Financing Cash Flow	-42.90B	-33.48B	-40.91B	-7.52B	-42.11B

China Telecom Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.22
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0728, the sentiment is Positive. The current price of 6.22 is above the 20-day moving average (MA) of 5.97, above the 50-day MA of 5.77, and above the 200-day MA of 5.33, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 73.05 is Negative, neither overbought nor oversold. The STOCH value of 89.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0728.

China Telecom Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0728	75 Outperform	€711.20B	15.90	7.35%	4.54%	1.35%	5.43%
Sector *	66 Neutral	¥483.17B	17.99	1.03%	2.20%	6.17%	-17.75%
CHWRF	―	$24.47B	11.31	5.62%	5.70%	―	―
CCTTF	―	$1.23B	10.60	8.46%	―	―	―
CUCSF	―	$4.24B	7.76	8.19%	10.62%	―	―
HKTTF	―	$12.34B	18.00	14.75%	6.42%	―	―
0008	62 Neutral	HK$42.62B	―	-14.69%	6.90%	4.26%	36.68%

China Telecom Corporate Events

China Telecom Schedules Board Meeting to Discuss Interim Results and Dividend

China Telecom Corporation Limited has announced that its board of directors will hold a meeting on August 14, 2025, to approve the interim results for the first half of the year and consider the payment of an interim dividend. This meeting is significant as it will provide insights into the company’s financial performance and potential shareholder returns, impacting its market positioning and stakeholder interests.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Approves Dividend and Strategic Resolutions at AGM

China Telecom announced the successful passage of all proposed resolutions at its Annual General Meeting and Shareholders’ Class Meetings, including the approval of a profit distribution and dividend plan for 2024. A final dividend of RMB0.0927 per share is set to be distributed on July 18, 2025. The meetings were attended by a significant number of shareholders, reflecting strong participation and support for the company’s strategic decisions. This announcement underscores China Telecom’s commitment to shareholder value and its stable financial position, which may positively influence its market standing and stakeholder confidence.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Announces Board Composition and Leadership Roles

China Telecom has announced the composition of its board of directors and the roles within its board committees. This announcement is significant as it outlines the leadership structure that will guide the company’s strategic direction and operational decisions, potentially impacting its market positioning and stakeholder interests.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Updates Final Dividend Details for 2024

China Telecom has announced an update regarding its final cash dividend for the year ending December 31, 2024. The dividend, declared at RMB 0.0927 per share, will be paid in Hong Kong dollars at a rate of HKD 0.100637 per share, with an exchange rate of RMB 1 to HKD 1.085618. The payment is scheduled for July 18, 2025, following shareholder approval on May 21, 2025. The announcement also outlines the withholding tax rates applicable to non-resident shareholders, which vary depending on the tax treaties between the shareholders’ countries of domicile and China. This update reflects China Telecom’s commitment to providing returns to its shareholders while navigating the complexities of international tax regulations.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Appoints New Executive Vice President

China Telecom Corporation Limited has appointed Mr. Huang Zhiyong as an Executive Vice President, effective from May 16, 2025. Mr. Huang, who has extensive experience in the telecommunications industry and has held various managerial roles within the company, is expected to strengthen the company’s leadership team and contribute to its strategic goals.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Announces Board Composition and Roles

China Telecom has announced the composition of its board of directors and the roles within its committees. The board includes a mix of executive, non-executive, and independent non-executive directors, with Ke Ruiwen serving as Chairman and CEO. This announcement highlights the company’s governance structure, which is crucial for maintaining transparency and accountability, potentially impacting investor confidence and stakeholder engagement.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.

China Telecom Appoints New President and COO

China Telecom has announced the appointment of Mr. Liu Guiqing as the new President and Chief Operating Officer, effective from May 16, 2025. Mr. Liu, who has extensive experience in the telecommunications industry and has held various leadership roles, is expected to strengthen the company’s operations and strategic positioning in the market.

The most recent analyst rating on (HK:0728) stock is a Buy with a HK$6.20 price target. To see the full list of analyst forecasts on China Telecom stock, see the HK:0728 Stock Forecast page.