Zhi Tong Cai Jing·2025-10-22 08:34Core Viewpoint - Morgan Stanley maintains an "Overweight" rating for China Mobile (600941) with a target price of HKD 110 for H-shares and CNY 130 for A-shares, despite lower-than-expected growth in service revenue and net profit for Q3 [1] Financial Performance - In Q3, China Mobile's service revenue increased by 0.8% year-on-year, while net profit rose by 1.9%, both below market expectations by 3% [1] - The growth rate has slowed from 6% in the previous quarter, attributed to rising hardware sales costs [1] - Mobile users grew by 0.5% to 1.01 billion, but average revenue per user (ARPU) declined by 3.2% to CNY 45.5 [1] Revenue Breakdown - Mobile revenue decreased by 3%, while fixed broadband revenue increased by 8%, supported by a 5% rise in broadband users [1] - The DICT business maintained a good growth rate in the first three quarters of the year, with AI-related revenue experiencing rapid growth [1] Capital Expenditure - Capital expenditure for the first three quarters was CNY 117 billion, remaining flat year-on-year [1] - The company previously guided for a full-year capital expenditure decrease of 8% to CNY 151 billion [1] Dividend and Profit Outlook - Despite potential short-term pressure on traditional telecom service revenue and a slow recovery in cloud revenue, the H-shares' annual dividend yield of approximately 6.2% remains attractive [1] - The company is expected to achieve positive growth in annual profits [1]