China Telecom Earnings: Another Solid Quarter; Shares Remain Undervalued

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 8% in 2022 and 7.7% in the first quarter, but EBITDA and profit growth were broadly in line. Growth in each of the key revenue lines slowed slightly with second-quarter mobile service as well as "wireline and smart family" revenue both growing 2.2%. Industrial digitization grew 14.6% year on year, which is a slight slowdown on 19% in 2022 and first-quarter 2023.