[ET Net News Agency, 22 October 2019] Credit Suisse lowered its target price for China
Mobile (00941) to HK$83.5 from HK$85 and maintained its "outperform" rating.
The research house sees a small "miss" in Mobile's 9-month results. EBITDA grew by 5.3%,
largely due to the implementation of IFRS 16; tower lease payments are no longer being
charged at the EBITDA level. Given that the costs simply shifted down the P&L account,
headline earnings declined by 13.9%, but this was still an improvement versus 1H's 14.6%
decline.
Nevertheless, Credit Suisse trimmed its FY2019 service revenue, EBITDA and net profit
forecasts by 1.7%, 2.2%, and 4.6%, respectively. Against this, management confirmed that
the company will maintain a "stable" dividend across the full year, and the upside risk to
total capex is now capped. (KL)