<div id="readability-page-1"><div><p>If you're looking for a multi-bagger, there's a few things to keep an eye out for.  In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing.  If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities.    Having said that, from a first glance at <strong>China Telecom</strong> (HKG:728) we aren't jumping out of our chairs at how returns are trending, but let's have a deeper look.</p><p>Trump has pledged to &#34;unleash&#34; American oil and gas and these 15 US stocks have developments that are poised to benefit.</p><h2> What Is Return On Capital Employed (ROCE)? </h2><p> If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business.  The formula for this calculation on China Telecom is: </p><p> <strong>Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)</strong> </p><p>0.07 = CN¥38b ÷ (CN¥876b - CN¥332b) <em>(Based on the trailing twelve months to September 2025)</em>.</p><p> Thus, <strong>China Telecom has an ROCE of 7.0%. </strong> On its own that's a low return on capital but it's in line with the industry's average returns of 7.0%.  </p><p><span> View our latest analysis for China Telecom </span></p><figure><img height="632" src="https://imageproxy.pbkrs.com/https://images.simplywall.st/asset/chart/3433645-roce-1-dark-2/1765925551523?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="666" original-src="https://imageproxy.pbkrs.com/https://images.simplywall.st/asset/chart/3433645-roce-1-dark-2/1765925551523"/><figcaption>SEHK:728 Return on Capital Employed December 16th 2025</figcaption></figure><p> Above you can see how the current ROCE for China Telecom compares to its prior returns on capital, but there's only so much you can tell from the past.  If you'd like, you can  check out the forecasts from the analysts covering China Telecom  for <strong>free.</strong> </p><h2> What Can We Tell From China Telecom's ROCE Trend? </h2><p> The returns on capital haven't changed much for China Telecom in recent years.   The company has consistently earned 7.0% for the last  five years, and the capital employed within the business has risen 23% in that time.   This poor ROCE doesn't inspire confidence right now, and with the increase in capital employed, it's evident that the business isn't deploying the funds into high return investments.   </p><h2> Our Take On China Telecom's ROCE </h2><p> In summary, China Telecom has simply been reinvesting capital and generating the same low rate of return as before.        Yet to long term shareholders the stock has gifted them an incredible 258% return in the last  five years, so the market appears to be rosy about its future.   But if the trajectory of these underlying trends continue, we think the likelihood of it being a multi-bagger from here isn't high.    </p><p> On a separate note, we've found  <strong> 1 warning sign for China Telecom </strong>  you'll probably want to know about.    </p><p> While China Telecom isn't earning the highest return, check out this <strong>free</strong> list of companies that are earning high returns on equity with solid balance sheets. </p><div><p>Mobile Infrastructure for Defense and Disaster</p><p>The next wave in robotics isn't humanoid. Its fully autonomous towers delivering 5G, ISR, and radar in under 30 minutes, anywhere.</p><p>Get the investor briefing before the next round of contracts</p><p><span>Sponsored On Behalf of CiTech</span></p></div></div></div>

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<p>China Telecom (HKG:728) has maintained a consistent Return on Capital Employed (ROCE) of 7.0% over the past five years, which is in line with the industry average but considered low. Despite a 23% increase in capital employed, the company has not achieved higher returns. While long-term shareholders have seen a 258% return, the potential for future high returns appears limited.</p>

Slowing Rates Of Return At China Telecom (HKG:728) Leave Little Room For Excitement