Shares of China Mobile yesterday took their steepest tumble in more than a month amid selling pressure prompted by the mainland company's lower than expected earnings in the first quarter. The world's largest mobile-telephone network operator, with about 477 million subscribers as of last month, dropped 5.11 per cent to close at HK$70.50, the biggest decline since March 20. With the tightening economy and increased domestic competition, China Mobile missed analyst estimates in the first quarter. The company posted its lowest rate of growth in five years, with net income rising just 5.2 per cent to 25.2 billion yuan (HK$28.58 billion) from 23.95 billion yuan in the same period last year. 'The first-quarter results reinforce our view that China Mobile is moving into a lower-growth environment,' said Tim Smart, the regional head of telecommunications research at Macquarie Research Equities. China Mobile has to compete in both wireless and fixed-line network services against China Telecom Corp and China Unicom under sweeping reforms implemented by Beijing. China Mobile also has the burden of promoting and growing domestic adoption of the mainland-created TD-SCDMA 3G mobile technology. Mr Smart noted that China Mobile's average revenue per user (arpu) in the first quarter continued to deteriorate, sinking 11 per cent year on year to 73 yuan per month, while its average minutes of usage per month for each subscriber was down 0.15 per cent, the operator's first such year-on-year decline in five years. In a report yesterday, Credit Suisse analyst Colin McCallum attributed China Mobile's weak arpu to its lower tariff promotions and the influx of low-end subscribers. While most securities research firms have cut their earnings estimates for the company for the rest of the year, analysts at Morgan Stanley remained optimistic about the operator's prospects in the nation's vastly restructured telecommunications industry. 'We continue to like China Mobile because it has the most attractive valuation among its peers, greater earnings resilience to [macroeconomic] slowdown and an excellent execution track record,' said a Morgan Stanley report yesterday. It said Beijing was highly supportive of the TD-SCDMA 3G standard and had launched 15 policies intended to help its further development, actions which would 'indirectly benefit' China Mobile.