UBS: Lowered China Tower's (00788) target price to HKD 13.5, maintains a "buy" rating.

UBS released a research report stating that CHINA TOWER (00788) third-quarter revenue, EBITDA, and net profit increased by 2.1%, 0.4%, and 4.5% year-on-year, respectively, which were about 1% to 3% lower than market expectations. This was mainly due to a decrease in tower revenue, an increase in maintenance costs, and credit impairment. The bank stated that after CHINA TOWER announced its latest performance, considering the downward revision of tower revenue forecast and the upward revision of operating expenditure forecast, they reduced their net profit forecast for 2025 to 2028 by 4% to 19%, lowering the target price from HK$15 to HK$13.5, while maintaining a "buy" rating. However, due to technological improvements and maintenance enhancements, CHINA TOWER has extended the depreciation period of DAS assets from 7 years to 10 years. According to the bank's estimate, this accounting change will reduce the company's depreciation expenses by approximately RMB 870 million this year, which is believed to help support its net profit and maintain stable dividend growth amid macro headwinds.