Senior Vice President of China Unicom Steps Down
Company Announcement: China Unicom announced the resignation of Senior Vice President Wang Limin effective today due to a change in work arrangement.
Market Activity: The company reported short selling of $54.26 million with a ratio of 26.032%.
Stock Performance: China Unicom's stock price increased by 0.020 (+0.277%).
Market Sentiment: JPMorgan noted that the volatility in internet stocks reflects fragile market sentiment, suggesting that current adjustments may present buying opportunities.
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US-China Leaders' Meeting: Ahead of the US-China leaders' meeting in April, the US has paused several national security measures aimed at key Chinese technologies.
Suspended Bans: The US government has put on hold bans affecting CHINA TELECOM, TP-Link routers, and the internet operations of CHINA UNICOM and CHINA MOBILE, as well as restrictions on Chinese electric trucks and buses.
Company Announcement: China Unicom announced the resignation of Senior Vice President Wang Limin effective today due to a change in work arrangement.
Market Activity: The company reported short selling of $54.26 million with a ratio of 26.032%.
Stock Performance: China Unicom's stock price increased by 0.020 (+0.277%).
Market Sentiment: JPMorgan noted that the volatility in internet stocks reflects fragile market sentiment, suggesting that current adjustments may present buying opportunities.

Telecom Industry Performance: The Chinese telecom industry experienced a significant slowdown in service revenue growth, dropping from 3.2% YoY to 0.7% in 2025, attributed to market saturation, competition, and a weak macro environment.
Broker Ratings and Target Prices: Nomura maintained a Buy rating on China Mobile while downgrading China Telecom and China Unicom to Neutral, with target prices adjusted downwards for both companies.

Tax Adjustment Announcement: Starting January 1, 2026, the tax for 'value-added telecommunication services' will be adjusted, increasing the VAT rate from 6% to 9% for services like mobile data, SMS, and internet broadband.
Impact on Revenue: Citi Research estimates that the tax change could lead to a 3% potential impact on service revenue for major telecom operators, as they may not pass the increased tax burden onto consumers due to market competition.
VAT Adjustment Announcement: Chinese telecom companies are increasing the value-added tax (VAT) on mobile data, SMS/MMS, and internet broadband services from 6% to 9%, which is expected to affect their net profits.
Impact on Net Profits: JPMorgan estimates that the profit impacts for CHINA MOBILE, CHINA TELECOM, and CHINA UNICOM will be 7.1%, 12.6%, and 11.9% respectively by 2026, with CHINA MOBILE likely facing the least damage due to its higher gross profit margin.
Dividend Yield Forecasts: JPMorgan predicts that the dividend yields for CHINA MOBILE, CHINA TELECOM, and CHINA UNICOM will be 7%, 5.7%, and 6.8% respectively in 2026, maintaining their attractiveness compared to the Hang Seng Index (HSI).
Investment Rating: Despite the VAT increase, JPMorgan has maintained an Overweight rating on the three telecom companies, indicating a positive outlook for their stock performance.

Market Decline: Hong Kong stocks experienced significant losses, with the HSI dropping 611 points (2.2%) to close at 26,775, influenced by a volatile commodity market and declining resource stocks.
Precious Metals and Resource Stocks: Gold and silver prices fell sharply, with major companies like SD GOLD and ZHAOJIN MINING seeing declines of over 8%, while resource stocks like JIANGXI COPPER and CHALCO also reported significant losses.
Telecom Sector Impact: Telecom companies faced declines due to an increase in VAT from 6% to 9%, with CHINA UNICOM and CHINA TELECOM dropping over 6%, and CHINA MOBILE falling by 2.3%.
Automotive and Chip Sector Struggles: Automakers reported substantial sales declines, with BYD COMPANY and XPENG-W experiencing drops of 30% YoY and 34% YoY respectively, while the chip sector also faced losses, particularly for SMIC and HUA HONG SEMI.





