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<Research>M Stanley Stays Cautious on CN Telecoms' Outlook, Expects Slim Rise in Industry Service Revenue for 3Q
Recommend 72 Positive 123 Negative 51 |
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Morgan Stanley, in its research report, forecast a mediocre overall performance for Chinese telecoms in 3Q25. Growth in AI-related business revenue may not be sufficient to offset the weakness in traditional revenue, and the broker remains cautious on 4Q25. Morgan Stanley maintained an Overweight rating for CHINA MOBILE (00941.HK), CHINA TELECOM (00728.HK), CHINA UNICOM (00762.HK), and CHINA TOWER (00788.HK), while CHINACOMSERVICE (00552.HK) was rated Equal-weight. Morgan Stanley expected industry service revenue to inch up YoY in 3Q25, with growth slowing compared to 2Q25. In wake of the potential impact of US-China tariffs, the outlook for 4Q25 was considered uncertain, with traditional businesses continuing to face deflationary pressures and weak macroeconomic conditions. The broker trimmed its earnings forecasts for the three major Chinese telecoms, reducing service revenue forecasts for China Mobile, China Telecom, and China Unicom by 2.1- 2.8%, 3%, and 1.7-2.2% respectively for 2025-27. The revenue forecast for China Tower was lowered by 1% for the same period. The target price for China Tower remained at $12; China Mobile at $90; China Telecom's lowered from $6.5 to $6; China Unicom's remained unchanged at $9.5; and China Communications Services' at $4.3. AASTOCKS Financial News Website: www.aastocks.com |
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