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<Research> G Sachs Raises CHINA MOBILE (00941.HK) TP to HKD94, Rating Neutral
Recommend 30 Positive 57 Negative 26 |
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G Sachs published a report stating that CHINA MOBILE (00941.HK) recorded 1Q26 operating revenue of RMB266.5 billion, up 1% YoY, broadly in line with the brokers expectations. The performance was mainly driven by growth in mobile subscribers and the expansion of computing and artificial intelligence (AI) services in the first quarter. However, the broker noted that 1Q26 EBITDA fell 5% YoY, missing its forecast; management emphasized that enhancing efficiency is one of the key priorities to strengthen competitiveness. Despite short-term pressure on telecommunications services, G Sachs remains positive on CHINA MOBILEs accelerated promotion of computing services, supported by strong growth in intelligent computing services and an expanding cloud video user base. In addition, 5G base station deployment remained weak. Ministry of Industry and Information Technology data showed that only 49,000 new 5G base stations were added in March 2026, below expectations. This is expected to put pressure on the companys short-term 5G subscriber and ARPU expansion. However, the broker expects differentiated services to drive ARPU improvement, while the 6G cycle will support long-term growth. G Sachs raised its 2026-2027 net profit forecasts for CHINA MOBILE by 2%, reflecting higher AI/computing service revenue, product mix upgrades, and improved operating efficiency leading to better EBITDA margin. Based on rolling the valuation model forward to 2027 and updated EBITDA forecasts, the H-share TP was lifted from HKD88 to HKD94, with the rating maintained at Neutral. (da/a) Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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