June 23, 2009 (Chinavestor)- U.S.-based financial holding company JPMorgan Chase & Co has raised its shareholding in China Telecom (NYSE:CHA) (HKG:0728) to 8.11% from 7.86% on June 18, according to the bourse operator Hong Kong Exchanges and Clearing Ltd. (HKG:0388)
HKEx said in a statement that JPMorgan Chase & Co. (NYSE:JPM) has acquired 34.730 million H-shares in China Telecom for HK$124.57.39 million ($16.07 million). The average price of the share transaction was HK$3.59 apiece.
China Telecom, the largest fixed line carrier in China, lost ground to China Mobile (Hong Kong) Ltd. , (HKG:0941) (NYSE:CHL) and China Unicom Ltd. (HKG:0762) (NYSE:CHU)(SHA:600050) in mobile phone subscriber numbers but has a lucrative data service and one of the best, most reliable 3G protocol. While China Mobile has to develop and commercialize a home grown technology, TD-SCDMA, China Telecom has former China Netcom's CDMA subscribers with a strong 3G potential. The protocol China Telecom is using is based on a widely popular platform with multiple handsets to choose from. This gives China Telecom a clear edge in 3G subscriber growth. While China Mobile commences 2/3rd of all mobile subsribers in China, there is no viable handset available that could handle both current 2G GSM services combined with a 3G TD-SCDMA protocol.
H-shares of China Telecom managed to shed only HK$0.01 or 0.28%, while the Hang Seng Index <.HSI> fell over 500 points, to end at HK$3.59 on Tuesday. China Telecom ADRs are outperforming major American benchmarks as well on Tuesday. The ADR price is at $46.36, up 1.89% by noon.
If history can be a guide in predicting future price movements, institutional buying is a positive signal for a stock preceding stock price appreciation.
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