[ET Net News Agency, 3 July 2018] HSBC Global Research lowered its target price for
Hutchison Telecommunications HK (HTHK)(00215) to HK$3.25 from HK$3.82, and retained its
"buy" rating.
The research house believes HTHK timed the disposal of its fixed-line business HGC well.
It has not yet issued guidance on what it will do with the proceeds, but it is exploring
all options.
HSBC favours a special dividend, and sees limited opportunities for value creation in
M&A outside Hong Kong. In the domestic market, M&A is feasible but it looks difficult to
get past holding company differences and rivalries.
Following the disposal of the fixed-line business, Hutchison will be a small wireless
operator in a tough market. HSBC is pessimistic on the outlook for Hong Kong's mobile
market: it sees limited prospects for consolidation, a possible new entrant, price
pressure at the high end and low end of the market, high spectrum costs, and the halving
of roaming revenue over the next 10 years. (KL)