China Telecom Earnings: Solid Growth Again but Valuation Reduced on Weaker Currency

China Telecom’s second-quarter 2023 result showed a continuation of the strong revenue and profit growth reported over the past two years. Second-quarter services revenue grew 5.5% with EBITDA up 5.3% and net profit up 12.4%, all year-on-year. Service revenue growth was a touch slower than 2022’s 8% and first quarter’s 7.7%, but the EBITDA and profit growth were broadly in line. Growth in each of the key revenue lines slowed slightly with second-quarter mobile service revenue and wireline and smart family revenue both growing 2.2%. Industrial digitization grew 14.6% year on year which is a slight slowdown on the 19% in 2022 and first-quarter 2023.