CICC: China Telecom (00728) maintained a “outperforming industry” rating with good year-on-year growth in comparable net profit in the third quarter

The Zhitong Finance App learned that CICC released a research report stating that China Telecom (00728,601728.SH)'s third-quarter revenue and net profit were in line with the bank's expectations. The bank maintained the company's H share “outperforming the industry” rating and a target price of HK$6.3, while maintaining the “outperforming industry” rating for A shares and a target price of RMB 7.3. The profit forecast remained unchanged.

China Telecom's revenue for the first three quarters of 2026 fell 3.6% year on year to 38.1 billion yuan (same below), and net profit fell 14.8% year on year to 26.2 billion yuan. Excluding the impact of VAT, the company's comparable net profit maintained good year-on-year growth. In the third quarter, the company's revenue fell 3% year on year to 121.1 billion yuan, net profit fell 14.7% year on year to 6.62 billion yuan, and comparable net profit maintained good year-on-year growth.

The bank pointed out that China Telecom's main revenue for the first three quarters was 359.3 billion yuan, which was basically stable year-on-year after excluding the impact of value-added tax. Among them, communications revenue was 313.1 billion yuan, a net increase of 2.84 million mobile users and a net increase of 210,000 cable broadband users in the third quarter; smart revenue was 46.2 billion yuan, and daily token calls grew rapidly. With the popularity of AI applications and the expansion of the number of users, the bank believes that intelligent business is expected to become the driving force for the company's future revenue growth.