We maintain the TP at HK$61.50 and the investment rating as "Buy". Given steadily rising profitability and strong cash position, we expect the dividend payout to exceed market expectations in the future. Thus, we maintain the TP at HK$61.50 and the investment rating as "Buy". The TP represents 9.5x/ 8.7x/ 8.1x 2022-2024 PER.
　　We expect service revenue to grow steadily. China Mobile's (the "Company") 1-3QFY22 results were in line with our expectations. In 1-3QFY22, revenue from telecommunications services increased steadily at 8.3% yoy to RMB620.1 billion. Revenue from sales of products and others surged by 36.4% yoy. EBITDA as a percentage of services revenue slightly decreased by 0.9 ppt yoy to 40.6%, while EBITDA increased by 5.9% yoy; the Company's shareholders' net profit increased by 13.0% yoy to RMB98.5 billion. We expect mobile users to still increase slightly in 4Q22 and the mobile ARPU to be relatively stable. Given the Company's strategy of bundling mobile and broadband services and its high mobile user base, we expect household broadband customers and wireline broadband users to further rise; due to bandwidth upgrades as well as penetration of value-added applications such as smart home network deployment, home security and voice remote control, we expect broadband blended ARPU to still increase; thus we expect "home" market revenue to still rise steadily. With strong market demand and the Company's continuous investment and its strength in cloud and network convergence, we expect DICT revenue to still grow strongly.
　　We expect the Company's future dividend payout to exceed market expectations. We expect EBITDA margin to decrease but EBITDA will increase, and shareholders' net profit will increase steadily. Given the expected steady cash position as well as the expected increase in EPS, we expect the dividend payout to exceed market expectations in the future.
　　Catalysts: Increase in dividend payout and dividend payout ratio.
Risk warning: Slower-than-expected growth of industrial digitalization business; pressure from increased competition on ARPU.