As one of the three major operators, China Telecom’s “Back to A” listing process has entered a countdown stage.
On August 10, according to the announcement, China Telecom’s A-share winning numbers exceeded 5.36 million, and 20 strategic investors including Huawei and Bilibili were also introduced.
Among them, Huawei has received about 220 million shares. Based on China Telecom’s issue price of 4.53 yuan per share, Huawei’s subscription for this time “spent” about 1 billion yuan.
While the process of returning to A listing is accelerating, China Telecom released its first half-year financial report. According to data, China Telecom’s operating income in the first half of the year was 219.2 billion yuan, a year-on-year increase of 13.1%; net profit was 17.74 billion yuan, a year-on-year increase of 27.2%.
However, the progress of China Telecom’s 5G construction in the first half of the year was obviously “behind”. The original plan was to build 180,000 5G base stations for the whole year of this year, while only 50,000 5G base stations were built in the first half of the year.
Overall, China Telecom achieved a new high in performance in the first half of this year. Comparing with the financial reports for 2020 and the first half of 2019, it can be found that China Telecom has grown very rapidly in terms of revenue and net profit.
Specifically, mobile communication services are still China Telecom’s pillar business, with revenue of 93.3 billion yuan in the first half of the year, a year-on-year increase of 6.9%. The number of mobile users was 362 million, a year-on-year increase of 5.5%. Among them, the number of 5G package users reached 131 million, and the mobile ARPU was RMB 45.7, a year-on-year increase of 2.9%.
In the first half of the year, China Telecom’s fixed-line and smart home service revenue reached 57.4 billion yuan, a year-on-year increase of 5.2%. The industry digitization revenue reached 50.1 billion yuan, a year-on-year increase of 16.8%. Among them, Tianyi Cloud’s revenue in the first half of the year exceeded that of last year.
In terms of 5G construction, China Telecom’s progress in the first half of the year has slowed down. China Telecom previously expected to build about 180,000 5G base stations in 2021, and the annual 5G capital expenditure was about 39.7 billion yuan.
In the first half of this year, China Telecom built 50,000 5G base stations, and 5G capital expenditure was 11.1 billion yuan. This means that if it is to achieve the previously planned goals, China Telecom needs to “run its full power” for 5G network construction in the second half of the year.
Why did the progress in the first half of the year lag behind? TMT independent analyst Fu Liang told Sohu Technology that China Telecom’s 5G construction plan this year has undergone major adjustments compared to last year, focusing on the construction of the 2.1GHz frequency band, and the first half of the year is the transition period from the 3.5GHz frequency band to the 2.1GHz frequency band. China Telecom should step up its construction in the second half of the year.
It is understood that compared to 3.5GHz, the 2.1GHz frequency band has a longer propagation distance, stronger diffraction and diffraction capabilities, stronger coverage, and has a certain cost advantage, but the industry chain is not so mature.
At the interim performance briefing meeting, Liu Guiqing, deputy general manager of China Telecom, said that 5G was the largest investment in the first half of the year, including investments in 3.5GHz and 2.1GHz equipment. On the whole, the investment in 3.5GHz equipment is relatively normal; the 2.1GHz needs to be adapted according to the current situation of the entire industry chain and the terminal ecology in the early stage. At present, the 2.1GHz equipment has been purchased.
Communications analyst Xiang Ligang believes that since China Telecom is in the stage of returning to A listing, if the expenditure in the first half of the year is too large, it may lead to unsatisfactory profits. “It is normal to reduce costs in the first half of the year and increase investment in the second half of the year.”
In addition, Liu Guiqing pointed out that the lag in investment progress was affected to a certain extent by the shortage of global chip supply, and the supply of some equipment was slower than expected. “At present, China Telecom has achieved good synergy with upstream and downstream. These problems have been resolved. The construction progress of the project should be accelerated in the second half of the year to ensure the completion of the entire year’s tasks and better adapt to business development.”
In the financial report for the first half of the year, China Telecom emphasized that the plan for 2021 will remain unchanged, and that it will strive to reach 700,000 base stations in use throughout the year. The year-end target will cover all counties and some developed towns, and promote the construction of rural areas, railways and highways along the entire industry. shared.
In addition, China Telecom also pointed out that it will strive to achieve double-digit growth in operating revenue and net profit throughout the year, and strive to achieve a growth of more than 20% in industrial digital revenue.
The highest fundraising is 54.2 billion yuan, and Huawei spends 1 billion yuan to subscribe
According to the prospectus, without considering the over-allotment option of this A-share issuance, the number of A shares issued by China Telecom does not exceed 10.396 billion shares; if the over-allotment option of this A-share issuance is fully exercised, the number of shares to be issued Will be expanded to 11.956 billion shares. Based on the issue price of 4.53 yuan per share, China Telecom will raise a maximum of about 54.2 billion yuan.
According to Wind Information data, before the over-allotment option was exercised, China Telecom’s initial fundraising was ranked 7th in the entire A-share market, and ranked 2nd in the past 10 years, second only to SMIC; if the over-allotment option is over-allocated Fully exercised, China Telecom’s initial fundraising is ranked 5th in the entire A-share market, ranking first in the past 10 years.
China Telecom said that the funds raised this time will be used for 5G industrial Internet construction projects, cloud-network integration new information infrastructure projects, and scientific and technological innovation research and development projects. At the investor exchange meeting on August 6, Ke Ruiwen, chairman of China Telecom, emphasized, “We will cherish and make good use of every penny in the capital market.”
On August 10th, China Telecom issued the “Announcement on the Results of the Initial Public Offering of Stocks Offline Initial Allotment and Online Winning Results”. Among them, more than 5.36 million A-share winning numbers.
The number of strategic placements is 5.183 billion shares, accounting for 49.86% of the total issuance of the green shoes before the exercise, and about 43.35% of the total issuance of the green shoes after the full exercise. These 20 strategic investors, including State Grid Yingda International Holdings, Huawei, Bilibili, etc., received approximately 5.183 billion shares. Huawei’s subscription amount is about 1 billion yuan, and the B station is about 500 million yuan.
On May 17, China Mobile announced that it plans to publicly issue no more than 965 million RMB shares (before the over-allotment option is exercised), accounting for 4.50% of the total share capital after the issuance. In contrast, China Telecom’s stock issuance scale is larger and the process is faster.
It is foreseeable that the three major operators will gather in A shares. This also marks that they have started a “new journey” in the capital market, and a new window of financing opens. However, whether it can be recognized by investors, the answer is still uncertain.
In China Telecom’s “new launch” discussion, users are most concerned about whether the stock will “break”. After all, the issue price of China Telecom’s A-shares is 4.53 yuan, and as of press time, the stock price of China Telecom’s Hong Kong shares is only HK$3.07. Previously, its issue price was HK$1.47.
According to China Times, a senior investment banker said that the investor groups of Hong Kong stocks and A-shares are not the same, and the valuation system is also different. One of the reasons for China Telecom’s return to A-shares is that the valuations given by the Hong Kong stocks have been overvalued. Low.Return to Sohu to see more