[ET Net News Agency, 3 April 2020] Nomura lowered its target price for China Unicom
(CU)(00762) to HK$4.8 from HK$7.4 and maintained its "neutral" rating.
The research house said CU posted 0.3% and 11.1% growth in revenue and earnings for
2019. Nomura thinks the company may face more challenges in securing its market share in
the mobile markets, as well as execution risks of co-build co-share with China Telecom
(CT)(00728).
Due to the immaturity of 5G network coverage and supply chain, as well as lack of
applications, Nomura believes the upside of 5G ARPU may be limited in the early adoption
stage, and CU may see higher operating costs for 5G at the current stage. As such, Nomura
lowered its 2020-21 forecasts for revenue by 1-2% and for earnings by 9-10%. (KL)