China Mobile’s A-share IPO came as agreed, and the issue price was very auspicious, 57.58 yuan per share, which was much higher than the current Hong Kong stock price of China Mobile.
As for whether China Mobile will break in the footsteps of China Telecom Corporation Limited(601728) after its listing, it is hard to guess. Compared with Hong Kong stocks, A-Shares have the premium advantage of “closed-loop investment”, so the pricing must be slightly higher.
but it is precisely because of the “anchor” of Hong Kong stocks that it is difficult for China Mobile’s A-Shares to rise sharply. from the company’s fundamental attributes and industry status, the performance after listing should be similar to Semiconductor Manufacturing International Corporation(688981) . Semiconductor Manufacturing International Corporation(688981) at present, the share price of A-Shares is basically more than three times that of Hong Kong shares. According to this valuation, China Mobile should not break, and the winners can make some “small money”.
Of course, what many people struggle with is that China Mobile raised 56 billion yuan, becoming the largest IPO project of A-Shares in recent ten years, ranking fifth in the history of a shares. To be honest, this 56 billion yuan is only symbolic for China Mobile.
Let’s first look at a set of data: in 2020, China Mobile’s capital expenditure reached 180.6 billion yuan, of which 5g related investment was 102.5 billion yuan; In 2021, China Mobile’s capital expenditure budget will reach 183.6 billion yuan, including about 110 billion yuan of 5g related investment plan.
According to the latest estimate, China Mobile’s operating revenue in 2021 will reach 844.877 billion yuan to 852.558 billion yuan, with a year-on-year increase of about 10% to 11%, and the net profit attributable to the shareholders of the parent company will be about 114.307 billion yuan to 116.464 billion yuan, with a year-on-year increase of about 6% to 8%.
it can be seen that the 56 billion raised funds are only half a year’s net profit, or half a year’s 5g capital expenditure, for China Mobile. neither the cash reserves on the account nor the cash flow that can be used for investment is a problem for China Mobile.
As one of the world’s largest telecom operators, the significance of China Mobile’s return to A-Shares is not how much money it raises, but “Dinghaishenzhen”. Its industry status is similar to Petrochina Company Limited(601857) and Industrial And Commercial Bank Of China Limited(601398) , and its industry prosperity and development prospects are far better than Petrochina Company Limited(601857) and Industrial And Commercial Bank Of China Limited(601398) , which should be similar to Semiconductor Manufacturing International Corporation(688981) , Contemporary Amperex Technology Co.Limited(300750) Similar to the first-line high-quality enterprises such as Kweichow Moutai Co.Ltd(600519) and China Merchants Bank Co.Ltd(600036) , the industry position is prominent, the industry prosperity is high, and the company is in an absolute leading position.
from this perspective, the advantages of China Mobile’s return outweigh the disadvantages.
To say the least, even if China Mobile raised 56 billion yuan, its purpose and efficiency are better than some unknown companies that raised billions.
With these raised funds, China Mobile has to invest in real projects. The funds raised in this issuance will be invested in “5g boutique network construction project”, “cloud resource new infrastructure construction project”, “Gigabit smart home construction project”, “smart middle platform construction project” and “new generation information technology R & D and digital intelligence ecological construction project”, These projects can be “seeing is believing”. However, many listed companies deposit their raised funds and over raised funds in the bank to buy financial products. Without comparison, there will be no harm.
(Financial Investment Report)
