The domestic floating received approval earlier from the State Council and is now waiting for the nod from the China Securities Regulatory Commission, said Tong Jilu, China Unicom's vice-president.

The telecom company had hoped to attract 12-18 billion yuan (US$1.45-2.2 billion) via the A-share floating. Tong said he is confident of a sum between 15-16 billion yuan (US$1.8-1.9 billion).

If it succeeds, this will be the biggest ever initial public offering (IPO) in China, surpassing Sinopec's 11.8 billion yuan (US$1.4 billion).

According to the vice-president in charge of financial operations, China Unicom's IPO will not happen before late June.

As the country's second biggest mobile phone carrier, China Unicom has recorded high growth rates in recent years. It made a dual listing in New York and Hong Kong in 2000.

The upcoming IPO will make it the country's first telecom carrier to be listed on domestic market, Tong said.

"I'm very confident in Unicom's performance in the domestic bourse, as this will be the first opportunity for domestic stock traders to invest in high growth telecom carriers," said Wang Jianzhou, China Unicom's president.

He said the domestic floating was one of Unicom's priorities for the year.

China Unicom's major competitor, China Mobile, is also considering collecting money in the domestic stock market using the China depository receipt (CDR).

The CDR is still under government research and there are no signs that it will be implemented soon.

But despite China Unicom's common A share or China Mobile's interest in the CDR, the market does not show that there will be a warm welcome for them.

China's stock markets experienced a steep downtrend since last June due to a slew of negative factors, including government plans to sell down huge State holdings in listed firms and a sweeping crackdown on market corruption.

Industry experts showed cautious optimism to China Unicom's floating, saying the good telecom concept may defeat the bad atmosphere.

"China Unicom is one of China's best operated telecom carriers with good company structure and an efficient management team," said Zhang Xinzhu, a telecom researcher with the Chinese Academy of Social Sciences.

He said if Unicom could carry on its high speed development, the shares will be very attractive to domestic investors.

But Dai Chunrong, a telecom analyst at China Securities, did not have high praise for China Unicom's IPO.

"Given the present unfriendly environment in the stock market and Sinopec's precedence, investors should be cautious before they buy China Unicom shares," Dai said.

Sinopec, China's biggest ever IPO which attracted 11.8 billion yuan (US$1.4 billion), dropped off its IPO price soon after its debut.

She said the present mood in the market is not very friendly to China Unicom due to its sluggish development in CDMA (code division multiple access) services.

China Unicom's CDMA development is lagging far behind the company schedule. Three months after its debut, CDMA has attracted 650,000 users only.

China Unicom is expected to increase their marketing campaign to reverse its slow growth in CDMA and create a friendlier environment for its IPO.

(China Daily April 4, 2002)