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<Research>UBS Cuts CHINA MOBILE's TP to HKD100; Resilience in Cash Flow Shown Amid Macro Headwinds Last Qtr
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CHINA MOBILE (00941.HK)'s 3Q25 service revenue grew by 0.8% YoY to RMB216.2 billion, in line with market expectations, according to a report from UBS.

Due to macroeconomic headwinds, the company's EBITDA fell by 1.7% YoY to RMB79.4 billion, 3% below market expectations. Its net profit slightly increased by 1.4% YoY, mainly driven by reduced depreciation and amortization expenses after capital expenditure peaked out, which partially offset the impact of higher operating expenses.

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CHINA MOBILE's 3Q25 operating cash flow surged by 47% QoQ to RMB77.2 billion, accounting for 36% of total service revenue, recovering from 18% in 1H25.

Although changes in CHINA MOBILE's accounts receivable remained stable, its 9M25 accounts payable decreased by RMB15.9 billion, indicating its support for upstream suppliers amid macroeconomic headwinds. UBS believed that CHINA MOBILE's cash flow should remain controlled as guided by management.

UBS moved the DCF model forward by three months and slightly reduced its target price for CHINA MOBILE from HKD102 to HKD100, implying a forecasted dividend yield of 5.7% for 2026, compared to the dividend yield of 6.7% at the current trading level.

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