Tietong plans public offering
By Chen Zhiming (China Daily)
Updated: 2004-08-21 13:37

China Tietong Group Co Ltd (CTT), one of the nation's six telecom operators, plans to raise funds via going public, but details of this have yet to be hammered out, sources close to company said.

The company is aiming to list both on the domestic A-share market and overseas markets, the source said.

Formerly China Railcom Group Co Ltd (CRC), China Tietong was officially inaugurated yesterday, marking a new start for the company.

"The birth of China Tietong means a new brand image and new look for us," Zhao Jibin, CTT's board chairman said at yesterday's launch ceremony in Beijing.

CRC changed its name to CTT last month and adopted a brand new logo.

"All the adjustment and reorganization within the company enables it to consolidate its business and seek further expansion in the country's telecom market," Zhao said.

Industry experts believe the reform and adjustment of the company will help develop its business amid the fiercer market competitions.

According to the board chairman, CTT is aiming for year-on-year growth of 30 per cent in its fixed-line subscribers and 50 per cent in its Internet users.

Meanwhile, it pledges to achieve 30 per cent growth in revenue on an annualized basis.

And the company plans to double its profits year-on-year.

To realize its goal, Zhao said the company will impress the market with excellent services, good products and a wide range of services.

"The value-added telecom service, for example, will be one of the key strategies for us," he said.

He believes that there is business potential in the value-added telecom service, as demand for the service is increasing among both enterprises and individuals.

The company will consolidate its market position by enhancing its performance in a range of fields to better demonstrate its capabilities as well as its services and technologies.

For example, it is going to increase its presence in the Yangtze Delta region.

Analysts believe that concentrating on such comparatively developed business areas will help CTT enhance its revenue and build up its brand.

Wang Ruixiang, deputy director of the State-owned Assets Supervision and Administration Commission (SASAC), agreed with Zhao's point of view.

"China Tietong should take advantage of its own characteristics as well as enhancing its co-operation with its partners."

He also agreed that CTT could seek more channels to raise more funds for future development such as bank loans and going public.

CTT attracted attention throughout the industry when it separated from the Ministry of Railways.

As a result, CTT started to operate as an independent telecom operator in the domestic market under SASAC's regulation.

The separation enables CTT to compete directly with the five other major telecom operators - China Telecom, China Netcom, China Mobile, China Unicom and China Satcom.

Analysts pointed out that CTT is currently quite distinctive from other telecom operators as it owns a nationwide network.

China Tietong, which was established on December 20, 2000, now has 31 branch companies at provincial level and five subsidiary companies.

"That has laid a solid foundation for China Tietong's further development," said Chen Jinqiao, director of the China Academy of Telecommunications Research under the Ministry of Information Industry (MII).

The ministry's plan to develop China into a telecoms power house and offer a fair and open environment has provided great opportunities for the company.

By the end of last year, the company had total assets of 42.4 billion yuan (US$5.1 billion) and a total workforce of 70,000.

The company currently mainly deals in fixed telecommunications networks such as fixed-line telephone, domestic and international long distance calls, IP phones, data transmission and the Internet, as well as other value-added telecom services.

According to China Tietong, it is likely to sign up 11 million fixed-line telephone subscribers by the end of this year.

Meanwhile, the revenue is likely to surpass 10 billion yuan (US$1.2 billion).

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