CI-CTEL@EC2601A

Jefferies Analyst Reiterates Buy Rating on China Telecom

Shenzhen AI and Robotics Institute Signs Strategic Agreement with China Telecom

China Telecom Launches Unified Enterprise Gateway Enhanced Version Product Centralized Procurement

China Adjusts VAT Rates for Telecommunication Services

TeleVideo 2.0 Multimodal Video Generation Model Ranks in Top 5 Globally

China Telecom and Shanghai Jiao Tong University Reveal Security Flaws in KAZ Algorithm Suite

China Telecom Upgrades Strategy to Fully Embrace Artificial Intelligence

China Telecom Launches AI Model Trained on Huawei Dedicated Chip

China Telecom AI Technology Leads in International Rankings

China Telecom Continues to Advance Quantum Metropolitan Area Network Construction

Chinalco and China Telecom Sign Strategic Cooperation Agreement to Promote Digital Transformation

China Telecom AI Company Completes Fundraising to Become the First State-Owned AI Unicorn

Goldman Sachs Downgrades Investment Ratings and Target Prices for China Telecom and China Unicom

China Telecom Adds AI Business Scope and Personnel Changes

CT and CM Achieve Technological Breakthroughs in IoT and Computing Network in 2025

China Telecom AI Company Becomes the First AI Unicorn in State-Owned Enterprises

China Telecom AI Successfully Completes First-Round Strategic Investment and Implements Employee Equity Incentive Plan

China Telecom Launches Fully Native Full-Mode AI Model System, China Mobile Completes 6G Prototype Development

China Telecom Aims to Fully Implement Cloud Reform and Digital Transformation Strategy

Zhenyou Technology Secures Expansion Project for TianTong-1 Satellite Communication System

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Jefferies analyst Edison Lee has reaffirmed a Buy rating for China Telecom (ZCH) with a price target of HK$7.54. Lee, a 5-star analyst with a 30.2% average return and 60% success rate, covers the Technology sector. While Jefferies maintains a positive outlook, TipRanks also noted a recent downgrade to Hold from another analyst on the same day.

Tip Ranks

CHINA TELECOM

Jefferies Sticks to Its Buy Rating for China Telecom (ZCH)

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Guangdong Telecom has suspended the bidding for two optical cable centralized procurement projects due to a surge in fiber optic prices. The projects include the framework procurement for emergency demand for optical cables in 2026 and the framework procurement for outdoor optical cables. The projects were suspended because the cost of optical cables exceeded the bidding limit, and manufacturers were unwilling to bid. The price of fiber optics has risen from less than 20 RMB per core kilometer to over 50 RMB per core kilometer

AASTOCKS

ChinaAMC CSI 5G Communication ETF

Harvest CNI Communication ETF

Guotai CSI All Share Communications Equipment ETF

Fiber optic prices soar, reports indicate that Guangdong Telecom has suspended two optical cable procurement projects

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KNOWLEDGE ATLAS(02513) rose 36.22%, with a trading turnover 1.2 Billion HKD, and a year-to-date rose 138.2%. MINIMAX-WP(00100) rose 11.71%, with a trading turnover 796.5 Million HKD, and a year-to-date rose 212.1%. EASTROC(09980) fell 3.87%, with a trading turnover 206.3 Million HKD, and a year-to-date rose 4%. CHINA TELECOM(00728) fell 2.96%, with a trading turnover 587.4 Million HKD, and a year-to-date fell 8.7%.

- The Hang Seng Index increased by 1.76%, with a year-to-date gain of 5.4%, while the Hang Seng Tech Index rose 1.34%, but has seen a 1.8% decline this year.  
- Zhipu (02513) surged by 36.22% with a trading volume of 1.16 billion HKD, marking a year-to-date increase of 138.2%.  
- In contrast, Dongpeng Beverage (09980) dropped by 3.87% with a trading volume of 210 million HKD, showing a 4% rise for the year, while China Telecom (00728) fell 2.96%, impacting its year-to-date loss of 8.7%.

Top Gainers & Losers

KNOWLEDGE ATLAS

MINIMAX-WP

GIGADEVICE

CTG DUTY-FREE

INNOVENT BIO

EASTROC

KUAISHOU-W

CHINA MOBILE

POWER ASSETS

Top 5 HK Stock Gainers/Losers (>100B) (2.9)

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China Mobile's recent announcement of increased value-added tax (VAT) from 6% to 9% on some services signals potential risks for Chinese companies amid falling fiscal revenues. While the impact on China Mobile's earnings is estimated at 6%, smaller competitors like China Telecom and China Unicom are still feeling the effects. Despite state media downplaying broad tax hikes, strained public finances may lead to a reevaluation of tax policies affecting the tech sector, which has historically enjoyed lower rates compared to state-owned enterprises. Policymakers face challenges as local government revenue continues to decline.

Reuters

China Unicom

China Mobile

CHINA UNICOM

China Mobile tax pain points to bigger risks

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According to China Space and Time Information Group, recently, China Space and Time has partnered with the three major telecommunications operators to launch the Beidou SMS service. Based on the service capabilities of China Space and Time, China Mobile, China Telecom, and China Unicom all support the Beidou SMS service. (CCTV)

Wallstreetcn

Fullgoal CSI Communication Equipment Thematic ETF

China Southern CSI Communication Service ETF

China Space and Time collaborates with operators to launch Beidou SMS services

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The three major A-share indices rebounded throughout the day, with the Shanghai Composite Index rising 1.3% to 4,067 points, the Shenzhen Component Index rising 2.2% to 14,127 points, and the ChiNext Index rising 1.9% to 3,224 points. The central parity rate of the RMB against the US dollar was adjusted to 6.9608. The People's Bank of China conducted a reverse repurchase operation of 105.5 billion yuan, with a net withdrawal of 296.5 billion yuan for the day. Aerospace and military stocks performed strongly, with XI'AN TRIANGLE DEFENSE and others rising by 18%. Telecommunications stocks fell against the market trend, with China Mobile and others declining between 0.4% and 1.4%

XI'AN TRIANGLE DEFENSE

The three major A-share indices of Shanghai and Shenzhen rebounded throughout the day by 1.3% to 2.2%, with aerospace and military stocks strengthening, while the three major telecommunications companies continued to weaken against the trend

Chunghwa Telecom Co., Ltd. reported its un-audited operating results for Q4 2025, with total revenue rising 0.5% to NT$ 65.65 billion. The Consumer Business Group saw a 5.9% revenue increase, while the Enterprise Business Group's revenue fell by 7.9%. Full-year revenue reached NT$236.11 billion, a 2.7% increase, with net income up 4.0% to NT$38.69 billion. The company achieved record high EPS of NT$4.99 for the year. Looking ahead, Chunghwa plans to enhance technology capabilities and expand into pre-6G opportunities, aiming for significant revenue growth in 2026.

StockTitan

Chunghwa Telecom

Chunghwa Telecom Reports Un-Audited Consolidated Operating Results for the Fourth Quarter of 2025 | CHT Stock News

On February 1st, China Mobile, China Unicom, and China Telecom announced that the value-added tax rate would be adjusted from 6% to 9%, which will affect the company's revenue and profits. As a result of this news, on February 2nd, the stock prices of the three major operators collectively fell, with a total market value decrease of over 100 billion yuan. Analysts pointed out that the tax rate increase may compress post-tax net profits, thereby affecting dividends and shaking the valuation foundation of the operators

- On February 1, China’s three major telecom operators announced a change in the value-added tax (VAT) rate from 6% to 9%, affecting their revenues and profits.  
- Following the announcement, stock prices for China Mobile, China Unicom, and China Telecom dropped significantly, with market values decreasing by over 1,000 billion yuan.  
- Experts predict that the VAT adjustment could reduce net profits by 9% for China Mobile, 17.9% for China Telecom, and 18.2% for China Unicom, though operational adjustments may mitigate some impacts in the long term.

Will the increase in VAT rates lead to price hikes for China Mobile, China Unicom, and China Telecom?

CICC's report points out that due to the increase in value-added tax on telecommunications services by the Ministry of Finance and the State Administration of Taxation, the stock prices of Chinese telecommunications companies may be under pressure in the short term. Assuming operators do not pass the tax burden onto customers, the decrease in after-tax revenue will affect profits. CICC has lowered its revenue and net profit forecasts for China Mobile and China Telecom for 2026, while maintaining its estimates for 2025. In the short term, the market needs to digest the changes in tax policy and profit outlook, and the target price has been adjusted downward

In "The Big Banks," CITIC Securities expects that the stock prices of Chinese telecommunications companies will be under pressure in the short term

On January 30, 2026, China announced an increase in the value-added tax rate for the telecommunications industry from 6% to 9%. This policy will impact the revenue and profits of China Mobile, CHINA TELECOM, and CHINA UNICOM, leading to a significant drop in stock prices. The expected impact on the profits of the three major operators ranges from 5% to 32%, with revenues projected to decline by approximately 2.75%. Due to intense market competition, operators will find it difficult to pass on the revenue reduction pressure to users, resulting in a direct negative impact on net profits in the short term

- On January 30, 2026, a new tax policy raised the VAT rate for telecom services from 6% to 9%, impacting core services like mobile data and broadband.  
- Major state-owned operators, China Mobile, China Telecom, and China Unicom, confirmed this would negatively affect their revenue and profits, with stock prices dropping significantly.  
- The policy is expected to decrease net profits by 4.6% to 8.4% for these companies, creating short-term challenges but maintaining long-term growth potential through high dividends and evolving cloud services.

The VAT rate jumps by 3 percentage points! The three major telecom operators are under short-term pressure; can new productive forces break the deadlock in the long term?

The three major A-share indices fell by 2.5% to 2.7% throughout the day. The mainland manufacturing PMI dropped to 49.3, and the non-manufacturing PMI also fell to 49.3, hitting a three-year low. The People's Bank of China conducted a reverse repurchase operation of 75 billion yuan, and the central parity rate of the yuan against the US dollar was lowered to 6.9695. The Shanghai Composite Index closed down 102 points, the Shenzhen Component Index fell 381 points, and the ChiNext Index dropped 82 points. Telecommunications, oil and gold, and semiconductor stocks were generally under pressure, Vanke expected an expanded loss, and the stock prices of the three major telecommunications companies declined

Vanke

CHINA VANKE

The three major A-share indices of Shanghai and Shenzhen fell by 2.5% to 2.7% throughout the day, with telecommunications, oil, gold, and semiconductor stocks all under pressure

The UBS report pointed out that the value-added tax for the three major telecommunications operators in mainland China will be raised from 6% to 9% starting January 1, 2023. This move is expected to have a significant negative impact on the profits of China Mobile, China Telecom, and China Unicom, affecting net profits by approximately 9%, 17.9%, and 18.2%, respectively. The bank anticipates that this adjustment will reduce the service revenue of telecommunications operators by about 1.5% to 2%. The three major telecommunications operators will strive to improve operational efficiency, focus on high-quality development, and accelerate the transition to artificial intelligence and cloud services to cope with the impact of the tax rate increase

UBS: The increase in value-added tax for mainland telecom operators is estimated to impact the profits of China Mobile, China Telecom, and China Unicom by 9%, 18%, and over 18%, respectively

In the Hong Kong stock market, the three major indices collectively fell, with the Hang Seng Index losing its recent high. The Hang Seng Tech Index and the National Enterprises Index also saw significant declines. The retail sector is under noticeable pressure, with major leading stocks lacking significant positive news, and institutional and investor sentiment is cautious. Tencent Holdings fell by 2.39%, and Alibaba -W dropped by 3.84%. Currently, there are no significant new positive factors at the macro level, and funds are focused on global risk appetite and the exchange rate of the Renminbi. The overall market performance is under pressure, awaiting external and policy-driven momentum

- Hong Kong's stock market indices fell sharply, with the Hang Seng Index down 2.92%, reflecting cautious market sentiment.  
- Key sectors, including internet content and telecommunications, experienced significant declines due to macroeconomic uncertainties and shifts in investor risk appetite, leading to notable losses for major companies.  
- Despite the downturn, some stocks like MINIMAX-WP and Yunzhisheng saw substantial gains, driven by strong interest in AI-driven technologies and positive business forecasts.

Market Heartbeat

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Hong Kong stocks intraday | The three major indices collectively fell, with heavyweight stocks like Tencent and Alibaba experiencing significant declines, while the AI sector showed independent market performance

CI-CTEL@EC2601A(18435.HK)

Jefferies Sticks to Its Buy Rating for China Telecom (ZCH)

Fiber optic prices soar, reports indicate that Guangdong Telecom has suspended two optical cable procurement projects

Top 5 HK Stock Gainers/Losers (>100B) (2.9)

China Mobile tax pain points to bigger risks

China Space and Time collaborates with operators to launch Beidou SMS services