BOC International has reiterated its "Buy" rating for CHINA UNICOM (00762), though it lowered the target price from HK$15.02 to HK$11.93. The valuation corresponds to a 2x price-to-sales ratio for the cloud business and a 2.8x EV/EBITDA multiple for the group. The firm also raised its forecast for Unicom Cloud revenue to 781 billion yuan and group EBITDA to 1,003 billion yuan for the 2026 fiscal year. BOC International believes the company exhibits strong defensive characteristics, supported by robust free cash flow and a 61.3% dividend payout ratio, providing steady valuation support even amid moderate profit growth. For the 2025 fiscal year, CHINA UNICOM's net profit attributable to shareholders increased by 1% year-on-year to 20.8 billion yuan, primarily driven by a 0.5% rise in service revenue, with overall performance largely in line with BOC International and market expectations. In the cloud business segment, Unicom Cloud revenue grew 5.2% year-on-year to 722 billion yuan, mainly due to an increase in cabinet utilization to over 72%. Data center revenue during the same period rose 8.5% year-on-year to 281 billion yuan, reflecting sustained demand for computing infrastructure. Looking ahead to the 2026 fiscal year, the company has guided capital expenditures of approximately 500 billion yuan, with over 35% allocated to computing-related areas, indicating a continued shift in resource allocation toward emerging businesses.