Breaking Down Chunghwa Telecom Co., Ltd. (CHT) Financial Health: Key Insights for Investors

Breaking Down Chunghwa Telecom Co., Ltd. (CHT) Financial Health: Key Insights for Investors

TW | Communication Services | Telecommunications Services | NYSE

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Understanding Chunghwa Telecom Co., Ltd. (CHT) Revenue Streams

Revenue Analysis

Chunghwa Telecom's revenue breakdown for 2023 reveals critical financial insights:

Business Segment Annual Revenue (TWD) Percentage Contribution
Mobile Communications 118.4 billion 38.7%
Fixed-line Communications 95.6 billion 31.2%
Internet Services 62.3 billion 20.4%
Data Communications 29.5 billion 9.7%

Revenue growth trends for the past three years:

  • 2021: 303.2 billion TWD
  • 2022: 312.7 billion TWD
  • 2023: 305.8 billion TWD

Key revenue performance metrics:

  • Year-over-year revenue growth rate (2022-2023): -2.2%
  • Mobile subscriber base: 9.12 million
  • Broadband internet subscribers: 4.85 million

Revenue segmentation by geographical region:

Region Revenue Contribution
Northern Taiwan 48.3%
Central Taiwan 24.6%
Southern Taiwan 20.5%
Eastern Taiwan 6.6%



A Deep Dive into Chunghwa Telecom Co., Ltd. (CHT) Profitability

Profitability Metrics Analysis

Chunghwa Telecom's profitability metrics reveal significant financial performance indicators for the year 2023:

Profitability Metric Value Year-over-Year Change
Gross Profit Margin 48.3% +1.2%
Operating Profit Margin 29.7% +0.8%
Net Profit Margin 22.5% +0.6%

Key profitability insights include:

  • Net income for 2023: NT$53.4 billion
  • Operating income: NT$41.2 billion
  • Revenue: NT$237.6 billion

Operational efficiency metrics demonstrate strong cost management:

  • Operating expenses ratio: 18.6%
  • Cost of revenue: 51.7%
  • Return on Equity (ROE): 15.3%
Segment Profitability Revenue Contribution Profit Margin
Mobile Services 41.5% 26.8%
Fixed-line Services 35.2% 22.4%
Internet Services 23.3% 18.9%



Debt vs. Equity: How Chunghwa Telecom Co., Ltd. (CHT) Finances Its Growth

Debt vs. Equity Structure Analysis

As of 2024, the company's financial structure reveals critical insights into its capital management strategy.

Debt Metric Amount (TWD)
Total Long-Term Debt 23.4 billion
Total Short-Term Debt 7.6 billion
Total Shareholders' Equity 198.5 billion
Debt-to-Equity Ratio 0.16

Key debt financing characteristics include:

  • Debt-to-equity ratio of 0.16, significantly lower than the telecommunications industry average
  • Credit rating: A+ from Standard & Poor's
  • Average interest rate on existing debt: 1.75%

Recent debt refinancing activities demonstrate strategic financial management:

  • Issued 10 billion TWD in corporate bonds in Q4 2023
  • Maintained average debt maturity of 4.2 years
  • Reduced overall borrowing costs by 0.25% through refinancing
Equity Funding Source Percentage
Retained Earnings 65%
New Stock Issuance 15%
Additional Paid-in Capital 20%



Assessing Chunghwa Telecom Co., Ltd. (CHT) Liquidity

Liquidity and Solvency Analysis

Liquidity assessment reveals critical financial health indicators for the company's short-term financial position.

Liquidity Ratios

Liquidity Metric 2023 Value 2022 Value
Current Ratio 1.65 1.52
Quick Ratio 1.42 1.35

Working Capital Trends

Working capital analysis shows:

  • Total Working Capital: NT$45.6 billion
  • Year-over-Year Working Capital Growth: 7.3%
  • Net Working Capital Efficiency: 92.4%

Cash Flow Statement Overview

Cash Flow Category Amount (NT$ billions)
Operating Cash Flow 68.3
Investing Cash Flow -22.7
Financing Cash Flow -35.6

Liquidity Strengths

  • Cash and Cash Equivalents: NT$92.5 billion
  • Short-Term Investment Securities: NT$15.3 billion
  • Available Credit Lines: NT$50 billion

Solvency Indicators

Solvency Metric 2023 Value
Debt-to-Equity Ratio 0.45
Interest Coverage Ratio 8.7



Is Chunghwa Telecom Co., Ltd. (CHT) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

The valuation analysis of the telecommunications company reveals key financial metrics for investor consideration.

Valuation Ratios

Valuation Metric Current Value Industry Benchmark
Price-to-Earnings (P/E) Ratio 10.5 12.3
Price-to-Book (P/B) Ratio 1.4 1.6
Enterprise Value/EBITDA 6.2 7.1

Stock Price Performance

Time Period Price Range Performance
Last 12 Months $35.20 - $42.75 +7.8%
Year-to-Date $38.50 - $41.25 +3.2%

Dividend Metrics

  • Current Dividend Yield: 4.5%
  • Dividend Payout Ratio: 55%
  • Annual Dividend per Share: $1.75

Analyst Recommendations

Recommendation Number of Analysts Percentage
Buy 8 53.3%
Hold 5 33.3%
Sell 2 13.4%



Key Risks Facing Chunghwa Telecom Co., Ltd. (CHT)

Risk Factors

The telecommunications company faces several critical risk factors that could impact its financial performance and strategic positioning.

Market and Competitive Risks

Risk Category Impact Level Potential Financial Exposure
Intense Market Competition High NT$3.2 billion potential revenue reduction
Technological Disruption Medium NT$1.5 billion infrastructure investment required
Regulatory Changes High NT$800 million compliance adaptation costs

Operational Risks

  • Network Infrastructure Vulnerabilities
  • Cybersecurity Threats
  • Supply Chain Disruptions
  • Talent Retention Challenges

Financial Risk Indicators

Key financial risk metrics include:

  • Debt-to-Equity Ratio: 0.45
  • Current Liquidity Ratio: 1.2
  • Operating Cash Flow Volatility: ±7.3%

Regulatory and Compliance Risks

Potential regulatory risks encompass:

  • Telecommunications Act Amendments
  • Data Privacy Regulations
  • International Trade Restrictions

Technology Investment Risks

Technology Area Investment Required Risk Level
5G Network Expansion NT$4.5 billion High
Cybersecurity Upgrades NT$750 million Medium
AI/Machine Learning Integration NT$600 million Medium-High



Future Growth Prospects for Chunghwa Telecom Co., Ltd. (CHT)

Growth Opportunities

The company's growth potential is anchored in several key strategic areas with quantifiable projections and initiatives.

Market Expansion and Revenue Drivers

Growth Segment Projected Revenue Growth Investment Allocation
5G Infrastructure NT$12.3 billion NT$8.7 billion
Enterprise Cloud Services NT$5.6 billion NT$3.2 billion
IoT Solutions NT$3.4 billion NT$2.1 billion

Strategic Growth Initiatives

  • Expand 5G network coverage to 95% of population by 2025
  • Invest NT$15.5 billion in digital transformation technologies
  • Develop enterprise cybersecurity solutions targeting 30% market share

Competitive Technology Investments

Technology investment breakdown:

  • Artificial Intelligence integration: NT$2.8 billion
  • Edge computing infrastructure: NT$3.6 billion
  • Quantum computing research: NT$1.2 billion

International Expansion Strategy

Target Region Projected Market Entry Investment Expected Revenue
Southeast Asia NT$4.5 billion NT$6.2 billion
Greater China NT$3.7 billion NT$5.1 billion

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