They are for sure using UI Scope.
Get in ADS mode and create a widget having the sight texture relative to the sight attached to the weapon.
Keep the sight image in the center of the screen in the widget.
Hide the Sight mesh, just take care to not hide it for other clients if the game is MP.
Now you can just play around with the FOV of the camera like in PUBG.
Why they are not using render target or Dolly Zoom?
1: Render target is performant for simple games with small maps with less amount of objects and with low res textures, and for the game like pubg it will be super performant.
2: Dolly Zoom will have some issues like if you stand near the wall and try to zoom it will just not work, cause the camera will be blocked by the wall.
Hope it helps cheers!