[ET Net News Agency, 23 October 2017] Credit Suisse lifted its target price for
Hutchison Telecommunications HK (HutchTel)(00215) to HK$2.95 from HK$2.7, and maintained
its "neutral" rating.
The research house said HutchTel is left with 76% stake in the number three mobile
operator in a highly competitive HK mobile market, and HK$13.5bn cash on the balance sheet
with no clarity on its utilisation, post divestment of the fixed line assets.
The HK mobile sector is going through a heightened competitive phase, making recovery in
HutchTel's mobile service revenue challenging. Credit Suisse expects HutchTel's mobile
service revenue to decline at a three-year CAGR (2017-19) of 2%.
HutchTel is currently evaluating options for utilisation of cash, Credit Suisse believes
investors will view outright special dividend payouts positively, however, any asset
acquisition (especially CK Hutchison group's mobile assets) would raise concerns. (KL)