<p>Hong Kong stocks have performed well recently, with some blue-chip stocks rising over 20% or even 30% in 2026. However, many retail investors view Chinese telecom stocks as stable high-yield options, which have been on a downward trend since late November last year. Among them, the leading stock China Mobile (941) has fallen more than 10% from its high in November last year. On the other hand, as stock prices decline, dividend yields have become more attractive, with China Mobile, China Unicom (762), and China Telecom (728) currently offering dividend yields of about 5.7 cents to 6.6 cents. Why have Chinese telecom stocks fallen into a slump? Is it a good opportunity to bottom out and collect dividends? Eric Wu, a strategist at Everbright Sun Hung Kai Securities, stated in an interview with Sing Tao Daily that the slump in Chinese telecom stocks is related to geopolitical risks. Senior investment and financial advisor He Qicong believes that the rising demand for AI-related equipment will drive up the prices of servers and storage semiconductors, thereby increasing the costs for telecom companies.</p>
<h2>Three Major Chinese Telecom Operators Face Geopolitical Risks</h2>
<p>According to data, China Mobile, China Unicom, and China Telecom have fallen approximately 11%, 22%, and 13% from their highs in November last year, respectively. Eric Wu pointed out that the recent sell-off of Chinese telecom stocks is primarily due to geopolitical risks. He explained that the three major Chinese telecom operators were previously banned by the U.S. Federal Communications Commission from accessing U.S. networks. Although their core revenue comes from mainland China, the direct financial impact is limited. However, if the networks become completely disconnected from the U.S., it will affect local network access, and investors are increasingly concerned whether regions like Europe will follow the U.S. approach, leading to heightened market anxiety.</p>
<h2>Burdened by Rising Prices of Servers and Storage Semiconductors</h2>
<p>In addition to political factors, the development of AI has also increased cost pressures on telecom companies. He Qicong anticipates that the surge in demand for AI-related equipment will drive up the prices of servers and storage semiconductors, potentially leading to increased costs for telecom companies. Eric Wu also added that telecom operators need to use memory-type chips for infrastructure construction, and rising costs may erode profit margins.</p>
<p>However, He Qicong also admitted that the specific impact is difficult to estimate. He stated that theoretically, base stations require high-end chips, but telecom operators never detail this expenditure in their financial results. As for the circulating rumors about the RMB exchange rate, Eric Wu believes it is not the main reason, as the A-share telecom sector has also declined.</p>
<table>
<thead>
<tr>
<th></th>
<th></th>
<th></th>
<th></th>
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</thead>
<tbody>
<tr>
<td>Performance of Chinese Telecom Stocks and Other Dividend Stocks This Year</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td>Stock</td>
<td>Last Friday's Closing Price (HKD)</td>
<td>Year-to-Date Change</td>
<td>Dividend Yield (Cents)</td>
</tr>
<tr>
<td>China Mobile (941)</td>
<td>79.5</td>
<td>-2.69%</td>
<td>6.58</td>
</tr>
<tr>
<td>China Unicom (762)</td>
<td>7.77</td>
<td>-0.13%</td>
<td>6.22</td>
</tr>
<tr>
<td>China Telecom (728)</td>
<td>5.24</td>
<td>-2.78%</td>
<td>5.73</td>
</tr>
<tr>
<td>Local Real Estate Stocks</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td>Sun Hung Kai Properties (083)</td>
<td>11.31</td>
<td>+10.67%</td>
<td>4.92</td>
</tr>
<tr>
<td>New World Development (016)</td>
<td>114.5</td>
<td>+20.91%</td>
<td>3.28</td>
</tr>
<tr>
<td>Chinese-funded Energy Stocks</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td>China Shenhua (1088)</td>
<td>40.7</td>
<td>+4.90%</td>
<td>8.66</td>
</tr>
<tr>
<td>CNOOC (883)</td>
<td>22.44</td>
<td>+5.35%</td>
<td>6.19</td>
</tr>
<tr>
<td>PetroChina (857)</td>
<td>8.42</td>
<td>+0.48%</td>
<td>6.10</td>
</tr>
<tr>
<td>Utility Stocks</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td>Hong Kong Electric (2638)</td>
<td>6.67</td>
<td>+5.87%</td>
<td>4.80</td>
</tr>
<tr>
<td>CLP (002)</td>
<td>73.6</td>
<td>+5.75%</td>
<td>4.28</td>
</tr>
</tbody>
</table>
<h2>He Qichong: 6 cents dividend is only reasonable, not attractive</h2>
<p>For investors, the most concerning issue is whether there is a &#34;bottom-fishing&#34; opportunity in Chinese telecom stocks. However, the views of the two experts differ. He Qichong bluntly stated that the current dividend yield of 5 to 6 cents is only reasonable and not very attractive, believing that the telecom industry itself has slow profit growth. Unless the development of AI in mainland China can significantly boost cloud business revenue and bring surprises.</p>
<h2>Wu Lixian: Take advantage of the adjustment cycle to deploy</h2>
<p>In contrast, Wu Lixian believes that the current price of Chinese telecom stocks is quite attractive. He pointed out that past experience shows that investors often pay attention to telecom stocks only when their prices are high, but they should actually deploy at low points during adjustment cycles for better value. He emphasized that Chinese telecom companies have maintained a good growth rate in dividend payouts over the past few years, with current dividend yields reaching 5 to 6 cents. Coupled with potential dividend growth, it is actually a good choice for income.</p>
<h2>Real estate and resource stocks also have high-yield options</h2>
<p>If investors are concerned about the uncertain outlook for telecom stocks, Wu Lixian also suggests shifting focus to other high-yield sectors, such as local real estate stocks. He explained that with the improvement in the local property market atmosphere, defensive stocks like Sun Hung Kai Properties (083) and New World Development (016) are suitable choices for income. Secondly, Chinese energy stocks, including CNOOC (883), PetroChina (857), and coal stock China Shenhua (1088), still offer quite attractive dividend returns. In addition, for investors seeking more stable options, utility stocks like CLP (002) or Hong Kong Electric (2638), which are less correlated with the economic cycle, are also safe choices for income.</p>
<p>Related articles:</p>
<p>Hang Seng seeks alternative stocks for delisting at the end of the month; experts say HSBC's valuation is expensive, naming two ETFs and one high-yield stock</p>

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<p>Chinese telecom stocks have recently performed poorly, continuing to decline since November last year, with China Mobile's stock price dropping by more than 10%. Despite an attractive dividend yield, analysts point out that geopolitical risks and rising demand for AI equipment have led to increased costs, impacting telecom companies' profits. The stock prices of China Mobile, China Unicom, and China Telecom have fallen approximately 11%, 22%, and 13% from their highs last year, respectively. Market sentiment towards telecom stocks is quite cautious, and investors need to carefully assess whether it is a bottom-fishing opportunity</p>

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Chinese telecom stocks are in a downturn, with China Mobile also suffering a 10% decline, raising concerns that it may become a stock affected by AI. Experts point out that the high dividend yield of over 6 cents is worth betting on