Shares in China Mobile (0941.HK: Quote, Profile, Research, Stock Buzz) and other telecoms carriers dived on Thursday, walloped by mounting worries over the cost of forays into next-generation businesses and the slow take-up of traditional services.

China Mobile faces intensifying competition and pressure on its traditional voice margins, and analysts said investors were discouraged by executives' comments this week about a national obligation to build up expensive, nationwide high-speed networks.

Beijing unveiled in May an industry reshuffle that will create two competitors to China Mobile via acquisitions between rival Unicom (0762.HK: Quote, Profile, Research, Stock Buzz) and fixed-line operators China Telecom (0728.HK: Quote, Profile, Research, Stock Buzz) and Netcom (0906.HK: Quote, Profile, Research, Stock Buzz). [ID:nHKG143379]

China Mobile shares sank nearly 8 percent in the afternoon to the lowest point this year, wiping out all of the previous session's gains and putting it on track for its sharpest single-day loss since May 26, after the government announced its sweeping sector revamp.

China Telecom, which unveiled a percent jump in first-half earnings, slid 5.6 percent.

Unicom was down nearly 11 percent at one point, while Netcom shed nearly 9 percent of its value.

JPMorgan downgraded China Mobile (CHL.N: Quote, Profile, Research, Stock Buzz) to underweight from overweight on Thursday and slashed its target price by 50 percent to HK$75. CLSA also downgraded the stock to underperform from buy.

source:Reuters