UBS released a research report stating that CHINA MOBILE (00941) has limited upside potential in its share price and lacks catalysts for a re-rating, lowering its target price from HK$100 to HK$81 and downgrading its rating from "Buy" to "Neutral". The report indicated that although Chinese telecom operators have commitments to dividend payouts and ongoing cost controls, internet giants are leading in AI capabilities and continue to capture cloud market share, while traditional telecom businesses face pressure in the macroeconomic environment, leading to the view that share price upside is limited. Based on an expected 2026 dividend yield of 7-8% and a low single-digit annual compound earnings growth rate, CHINA MOBILE is anticipated to struggle to generate excess returns. UBS forecasts CHINA MOBILE's net profit will grow 2-3% in 2025-2026, with payout ratios reaching 74.5% and 76% respectively, implying annual dividend per share growth in the mid-single-digit percentage range, corresponding to an expected 2026 dividend yield of 7-8%. The bank expects CHINA MOBILE's 2026 capital expenditure to decline by 2.3%, with a structural shift towards computing equipment like AI servers, which have a shorter depreciation period compared to traditional telecom equipment. According to the bank's observations, China's leading large language AI models are still in an evolutionary stage, and enterprise customers are also in the phase of exploring AI application scenarios. Consequently, initial AI projects still require significant customization, creating uncertainty around profitability. UBS noted that CHINA MOBILE's current expected 2026 dividend yield is approximately 7%, higher than the Asia-Pacific peer median of 5%, but its 2025-2028 annual compound earnings growth rate is only 2%, lower than the 6-7% seen among Asia-Pacific peers. As CHINA MOBILE has already provided clear dividend guidance, the bank believes the stable dividend outlook is already fully reflected in the current share price.