VTECH Holdings is planning an industrial city of about 100 hectares in southern China, to share with its suppliers and tenants from the electronics industry and to ease crowding at its cordless telephone plant in Dongguan, Guangdong province. Financial managing director William Ho Mook-lam said the company was still looking for a suitable location but would invite interested mainland parties to participate. ''The project aims to concentrate our suppliers at one place to reduce both the time and cost of materials delivery,'' Mr Ho said. VTech also produces cellular mobile telephones in Yuen Long through Technophone Manufacturing (HK), a venture with Nokia Mobile Phones. VTech chairman Allan Wong Chi-yun said US$3 million would be spent to expand Yuen Long production lines by 50 per cent in the next fiscal year. ''Telecommunication products account for about 10 per cent of the group's overall turnover, worth $75 million in the 1993 fiscal year,'' he said. ''We expect its sales to continue to increase and will double the figure next year.'' The group's mobile telephones were destined for the US and Europe but it had no schedule to expand in the mainland market, Mr Wong said. ''Demand is weak in China because not many people can afford transportable phones. It may need a further three years to develop the market,'' he said. However, VTech would hold exhibitions in 12 mainland commercial centres over the next two months, starting in Beijing on December 6. The exhibitions would include products from Microsoft, which plans to provide the software for VTech hardware in a joint venture to be detailed to the public in May next year.