China Telecom (Hong Kong) says it expects its focus to remain on the mainland's mobile phone market and that it will look to buy other cellular companies from parent China Telecom. The company's listing next month will be Hong Kong's largest ever flotation, raising about US$3 billion and valuing it at up to $14.8 billion. Chief executive Shi Cuiming said it would not look to purchase assets from abroad but concentrate on growing and acquiring new businesses on the mainland. 'The focus will be on mobile companies,' he said. Although there is competition in the mobile sector on the mainland, China Telecom - the operational arm of the Ministry of Posts and Telecommunications - has a virtual monopoly on the market. Vice-chairman Li Ping said he did not expect that position to change rapidly. 'Over the next three to five years, we do not expect any real competition in China because we are the only experienced cellular phone operator in China.' The company kicks off its international roadshow today in Hong Kong with the message that the mainland cellular market has enormous growth potential. Its assets include the parent's cellular networks in Guangdong and Zhejiang provinces. At the end of August, the networks had three million subscribers, or 28 per cent of the mainland market. Its only rival, China Unicom, formed by various competing ministries and large companies, holds about 2 per cent. In Guangdong and Zhejiang, China Telecom's market share is more than 98 per cent. The company forecasts net profit of 4.41 billion yuan (about HK$4.09 billion) this year, from 4.51 billion yuan last year. China Telecom said the drop was due to higher depreciation charges after an asset revaluation for the listing, lower connection fees and higher effective income tax rate. Mr Li said connection fees would continue to fall, as the company tried to expand market share by recruiting more subscribers. However, this revenue loss would be compensated by an increase in income of usage fees with more subscribers. He forecast the Guangdong and Zhejiang networks would together have seven million subscribers by 2000. 'Our charge for usage is among the lowest compared to similar cellular services and we will consider raising the charge, if it is approved by the government,' Mr Li said. Mr Shi said the listing proceeds would be used to expand capacity of its networks in Guangdong and Zhejiang, and to make strategic investments in the cellular industry. Many observers had been expecting Hongkong Telecom parent Cable & Wireless (C&W) to be included as a strategic shareholder in the newly listed company, but president Chen Zhaobin said C&W would not be investing in the listed arm but in its holding company.