Nov 7 (Reuters) - KPN will pay shareholders 3.8 billion euros ($4.06 billion) between 2024 and 2027, including up to 1 billion euros via share buybacks, the Dutch telecoms group said on Tuesday as it projected growth in service revenue and core profit over the period.

KPN is targeting a compound annual growth rate (CAGR) of about 3% for 2024-2027 for both service revenue and adjusted EBITDA after leases, it said in a statement released on its capital markets day.

Debt-saddled European telecoms have been struggling to find growth as they operate in small, highly competitive markets, but investors have poured money back into the sector in hopes that costly investments have peaked.

KPN, which has been rolling out fibre internet in the Netherlands, said its annual capital expenditure would remain at around 1.2 billion euros until 2026 and drop below 1 billion in 2027 resulting in a "material inflection" in its free cash flow.

The targets for 2027 "underpin a strong growth and shareholder return story," J.P. Morgan analysts wrote in note. KPN's 2024 core earnings (EBITDA AL) outlook of around 2.48 billion euros was roughly in line with a consensus cited by the brokerage.

KPN shares were up 0.3% as of 1000 GMT.

"At this moment, KPN has a much larger homes connected percentage compared to its main competitors and intends to maintain this competitive advantage," the company said.

The group confirmed its financial objectives for the current year and said it intends to distribute a regular dividend of 17 cents per share for 2024, up from 15 cents for 2023.

KPN will also buy back 200 million euros worth of shares next year, it said.

($1 = 0.9354 euros) (Reporting by Olivier Sorgho and Federica Mileo; editing by Kirsten Donovan and Jason Neely)