China Unicom’s FY21 results were in line with our expectations. Service revenue increased by 7.4% yoy. EBITDA increased by 2.3% yoy, while shareholders' net profit was up by 15.0% yoy.
We expect service revenue to increase steadily in 2022. Due to rising mobile ARPU promoted by 5G and expected stable mobile user base, we expect mobile service revenue to increase steadily in 2022. We expect fixed-line broadband service revenue to increase yoy in 2022 due to rising number of subscribers and expected stable ARPU. Followed by the new opportunities from "Eastern Data and Western Computing" initiative, the Company has built a national advanced IDC system. Due to strong market demand, we expect industry internet revenue to be strong.
We expect operating expenses to grow rapidly in 2022. In 2022, we expect that growth of network, operation and support expenses as well as growth of general, administrative and other expenses will be higher than growth in service revenue, while growth of staff costs will be basically in line with growth in service revenue. We expect that selling and marketing expenses as well as depreciation and amortization will have modest increase in 2022. We expect that EBITDA margin will decrease yoy but EBITDA will increase yoy in 2022.
We revise down the TP from HK$5.60 to HK$5.00, but maintain the investment rating as "Buy". We revise down FY22-FY23 EPS forecasts by 2.0%/ 0.5%, respectively. The TP represents 7.7x, 7.1x and 6.6x FY22-FY24 PER.