Core Viewpoint - China Tower, established in 2014, has become the world's largest communication infrastructure service provider, supported by the three major telecom operators in China, with a mission to provide essential communication infrastructure and services [1][2]. Group 1: Company Overview - As of June 2025, China Tower's site scale exceeds 2.1 million, with total assets over 330 billion yuan and net assets exceeding 200 billion yuan [1]. - 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 [1]. Group 2: Financial Performance - Revenue increased from 71.82 billion yuan in 2018 to 97.77 billion yuan in 2024, with a compound annual growth rate (CAGR) of 5.28% [1]. - Net profit grew from 2.65 billion yuan in 2018 to 10.73 billion yuan in 2024, with a CAGR of 26.25% [1]. Group 3: Business Segments - Tower business contributes over 70% of revenue, serving as a stable cash flow source, with site sharing levels improving as the 5G base station construction nears completion [1]. - As of June 2025, the number of tower sites reached 2.119 million, with operator tenants increasing to 3.579 million [1]. Group 4: Two Wings Business Development - The smart connection business, leveraging products like "Tower Vision," has seen double-digit revenue growth, with tenant numbers rising from 199,000 in 2021 to 265,000 in H1 2025 [2]. - The energy business, centered on battery swapping, has established a significant presence in the domestic market, with operations in over 320 cities and 81,000 battery swap points [2]. Group 5: Shareholder Returns - The dividend payout ratio has increased from 14.98% in 2018 to 68.19% in 2024, with the company distributing its first interim dividend in 2024 [3]. - As depreciation costs from large-scale tower construction decrease, profits are expected to accelerate, enhancing shareholder returns [3].

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 - China Tower aims to showcase its innovative service experience at the 2025 China Service Trade Fair, highlighting its role in national strategic initiatives and digital transformation [3] Group 1: 5G Infrastructure and Digital Transformation - China Tower has constructed over 2.97 million 5G base stations, accounting for nearly half of the global total, with indoor coverage reaching 13.85 billion square meters [5] - The utilization rate of site resources has increased from 14.3% to 86.2%, supporting a 1.6 times expansion in network scale for operators [5] Group 2: Major National Projects - The Fengtai Railway Station and the Shenzhen-Zhongshan Link are highlighted as key projects, showcasing innovative communication solutions that integrate aesthetics and functionality [7] - China Tower has successfully provided communication support for over 100 national-level events, including the Beijing Winter Olympics and the Belt and Road Forum [7] Group 3: Smart Technology and AI Integration - The company is transitioning from "communication towers" to "digital towers," integrating smart terminals to create a comprehensive sensing network across various environments [8] - China Tower has developed 216 proprietary algorithms, with 80 reaching industry-leading levels, applied in areas such as emergency management and environmental monitoring [8] Group 4: Energy Services and Urban Logistics - The "Tower Battery Swap" service revolutionizes urban logistics for delivery personnel, providing quick battery swaps through an app, alleviating range anxiety [9] - China Tower has established over 3.17 million charging ports, serving over 26.17 million users, enhancing safety and convenience for electric bike users [9]

Core Insights - In the first half of 2025, China Tower reported a revenue of 49.601 billion RMB, a year-on-year increase of 2.8%, and a profit attributable to shareholders of 5.757 billion RMB, up 8% [1] Group 1: Operator Business - The operator business generated a revenue of 42.461 billion RMB, reflecting a year-on-year growth of 0.8% [1] - Tower-related revenue was 37.797 billion RMB, remaining stable compared to the same period last year [1] - As of June 30, 2025, the number of tower sites reached 2.119 million, an increase of 25,000 from the end of the previous year, with operator tower tenants totaling 3.579 million, up by 35,000 [1] Group 2: Smart Connection Business - The smart connection business achieved a revenue of 4.726 billion RMB, marking an 18.7% year-on-year increase [2] - The company focuses on spatial digital governance, enhancing its service offerings in key sectors such as agricultural protection, fishery law enforcement, forest fire prevention, disaster warning, and emergency rescue [2] Group 3: Energy Business - The energy business reported a revenue of 2.209 billion RMB, with a year-on-year growth of 9.2% [3] - The number of battery swap users reached approximately 1.47 million, an increase of 166,000 from the end of the previous year, maintaining a leading position in the low-speed electric vehicle battery swap market [3] Group 4: Technology and Innovation - The company has strengthened its focus on technological innovation, with a 29% increase in the number of R&D personnel compared to the same period last year [3] - The total number of authorized invention patents increased by 16% from the end of 2024 [3]

Core Viewpoint - The 9th China-South Asia Expo showcased China Tower Corporation's latest achievements in information communication infrastructure, new energy applications, and digital services, emphasizing its "one body, two wings" strategic layout aimed at supporting operator businesses and expanding tower intelligence and energy services [1]. Group 1: Infrastructure Development - China Tower has built a total of 58,000 new towers and achieved indoor coverage of 300 million square meters in Yunnan since its establishment [5]. - The company has implemented 5G network coverage in all administrative villages in Yunnan and is involved in public network coverage projects for high-speed rail and subways [5]. Group 2: Digital Services - China Tower is transitioning from industry sharing to social sharing, creating a unified open platform called "Tower Vision Link" that serves various industries, including forestry, water conservancy, and environmental protection [7]. - The company has established over 130 AI algorithms and signed strategic cooperation agreements with 22 clients across nine major industries [7]. Group 3: Energy Services - China Tower extends its communication base resources to provide diversified smart energy services, including tower battery swapping, charging, and backup power [7]. - The company has developed a three-in-one service system that integrates new energy travel, power assurance, and comprehensive energy solutions [7]. Group 4: International Expansion - China Tower has established a Southeast Asia Tower LLC to collaborate with telecommunications companies in Laos, contributing to the construction of over 290 communication towers [8]. - The company aims to deepen cooperation in technology innovation, standard setting, and ecosystem building with global partners to strengthen the foundation of digital infrastructure [8].