Investment Rating - The report assigns an "Accumulate" rating for China Tower (00788) as a first-time coverage [6]. Core Viewpoints - China Tower, established in 2014, is the world's largest communication infrastructure service provider, backed by the three major telecom operators in China, ensuring a solid industry leadership position [1][15]. - The company has adopted a "one body, two wings" strategy, focusing on operator business while expanding into cross-industry and energy operations, leading to steady revenue growth [2][24]. - The tower business remains a stable cash flow source, contributing over 70% of revenue, while the indoor distribution and energy businesses are rapidly growing [3][4]. Summary by Sections Company Overview - China Tower was established to address the issue of redundant construction in the telecom industry, providing site space, supporting facilities, maintenance, and power services [15][18]. - As of June 2025, the company has over 2.1 million sites and total assets exceeding 330 billion yuan [1][15]. Business Strategy - The "one body, two wings" strategy integrates operator business as the core, with intelligent connection and energy businesses as the wings, enhancing growth potential [2][24]. - The company has seen a shift in revenue structure, with the tower business's share decreasing from 93.4% in 2019 to 76.2% in H1 2025, while the contributions from intelligent connection and energy businesses are increasing [25][24]. Financial Performance - Revenue has grown from 71.82 billion yuan in 2018 to an expected 97.77 billion yuan in 2024, with a compound annual growth rate (CAGR) of 5.28% [2][28]. - Net profit has increased significantly from 2.65 billion yuan in 2018 to an expected 10.73 billion yuan in 2024, with a CAGR of 26.25% [2][31]. - The company has a high dividend payout ratio, increasing from 14.98% in 2018 to 68.19% in 2024, reflecting a commitment to shareholder returns [5][45]. Business Segments - The tower business is entering a phase of stock operation, with site sharing levels improving; as of June 2025, the number of tower sites reached 2.119 million [3][81]. - The indoor distribution business has seen rapid growth, with revenue increasing from 1.82 billion yuan in 2018 to 8.43 billion yuan in 2024, maintaining a CAGR of 29% [93]. - The energy business, focusing on battery swapping, has expanded rapidly, with over 320 cities offering services and a market share nearing 50% [4][34]. Market Position - China Tower leads the global market in terms of revenue, with 97.77 billion yuan in 2024, while also facing competition from American and Indian tower companies [53][56]. - The company benefits from a stable ownership structure, primarily held by the three major telecom operators, ensuring a solid operational foundation [20][24].

Core Viewpoint - The article highlights the significant advancements and contributions of China Tower Corporation in the construction and sharing of telecommunications infrastructure, particularly in the context of 5G and digital transformation initiatives in China [1][2][3][4][5][6][7][8]. Group 1: Infrastructure Development - The Jidayan High-Speed Railway in Shanxi Province is set to commence operations on December 31, 2024, with China Tower integrating 4G and 5G network construction into a shared plan, achieving full signal coverage across 426 base stations and 18.49 kilometers of tunnels in just four months [1]. - Since its establishment in 2014, China Tower has led a "sharing revolution" in the telecommunications industry, significantly reducing redundant base station construction and achieving a 50% cost saving in projects like the Dalian Metro communication network [2]. - By the end of last year, China Tower had constructed over 2.76 million 5G base stations, covering an area of over 12.6 billion square meters and extending coverage to over 44,000 kilometers of high-speed and subway lines [3]. Group 2: Resource Sharing and Cost Efficiency - Over 95% of 5G construction projects have utilized existing resources such as communication towers and streetlight poles, leading to a substantial reduction in construction costs and time [3]. - The new tower sharing rate increased from 14.3% to 85%, equating to the avoidance of building 1.2 million new towers, saving 68,000 acres of land and over 210 billion yuan in industry investments [3]. Group 3: Digital Transformation and Smart Solutions - China Tower is transitioning from traditional communication towers to "digital towers" by integrating advanced technologies such as AI and big data, enhancing capabilities in various sectors including environmental monitoring [4][6]. - The company has upgraded 230,000 communication towers to digital towers, contributing to the construction of a digital China [4]. Group 4: Social Responsibility and Community Impact - China Tower has invested 8.5 billion yuan in universal telecommunications services, building over 70,000 base stations to ensure 100% network coverage in administrative villages [7]. - The company has deployed over 76,000 battery swap stations across more than 320 cities, providing over 2 million battery swaps daily, significantly reducing carbon emissions by 3.3 million tons [7]. Group 5: Future Commitments - China Tower aims to continue its mission of building a strong digital infrastructure to support the digital economy and enhance public welfare through ongoing resource sharing and technological innovation [8].