Industrial sector sees 20.5% surge in profits
By Wang Yanlin |
November 28, 2012, Wednesday
|
Print Edition
Print Edition
The profits of Chinese industrial companies grew at their fastest pace in nearly a year last month, indicating strengthening economic stabilization in the world's largest manufacturing base.
Net earnings among Chinese industrial companies rose 20.5 percent from a year earlier to 500.1 billion yuan (US$80.3 billion) in October, the National Bureau of Statistics said yesterday.
That was a sharp acceleration from the increase of 7.8 percent in September and the strongest gain since December 2011.
In the first 10 months, industrial companies' profits grew 0.5 percent to 4.02 trillion yuan, reversing the 1.8 percent contraction of the first three quarters.
"It is encouraging to see China's manufacturing sector starting to earn money again, which proves recovering demand and provides foundation for more investment," said Li Maoyu, an analyst at Changjiang Securities Co.
The profits increase added to evidence of a strengthening industrial sector in recent months.
The preliminary reading of the HSBC China Manufacturing Purchasing Managers' Index rose to a 13-month high of 50.4 for November, HSBC Holdings Plc said last week. As the earliest available indicator of the industrial sector's vitality, the index pointed to expansion in largely private companies for the first time in more than a year.
Qu Hongbin, chief economist for China at HSBC, said economic recovery was continuing to gain momentum towards the end of the year. But it was still an early-stage recovery and more policy easing was needed, Qu said.
Barclays economist Chang Jian said China's economic rebound would be moderate and external conditions could still affect economic policy in the near future. He expected China's fourth-quarter gross domestic product growth to pick up to around 7.8 percent from 7.4 percent in the third quarter.
China's economy showed signs of recovery with better-than-expected performances in September and October. Industrial production gained 9.6 percent annually last month, compared to 9.2 percent in September and August's 8.9 percent.
Among the 41 industries tracked by the national statistics bureau, 27 reported profits growth during January-October, led by the electricity generation and power supply industry, whose profits surged 57.5 percent.
IT machinery production profits expanded 10 percent in the first 10 months, and those of automobile manufacturing gained 9 percent.
Private business reported a profits growth of 17 percent to October, while those of foreign-invested firms and firms in Hong Kong, Macau and Taiwan slumped 9.2 percent.
State-owned enterprises said their profits also fell 9.2 percent during the first 10 months.
Net earnings among Chinese industrial companies rose 20.5 percent from a year earlier to 500.1 billion yuan (US$80.3 billion) in October, the National Bureau of Statistics said yesterday.
That was a sharp acceleration from the increase of 7.8 percent in September and the strongest gain since December 2011.
In the first 10 months, industrial companies' profits grew 0.5 percent to 4.02 trillion yuan, reversing the 1.8 percent contraction of the first three quarters.
"It is encouraging to see China's manufacturing sector starting to earn money again, which proves recovering demand and provides foundation for more investment," said Li Maoyu, an analyst at Changjiang Securities Co.
The profits increase added to evidence of a strengthening industrial sector in recent months.
The preliminary reading of the HSBC China Manufacturing Purchasing Managers' Index rose to a 13-month high of 50.4 for November, HSBC Holdings Plc said last week. As the earliest available indicator of the industrial sector's vitality, the index pointed to expansion in largely private companies for the first time in more than a year.
Qu Hongbin, chief economist for China at HSBC, said economic recovery was continuing to gain momentum towards the end of the year. But it was still an early-stage recovery and more policy easing was needed, Qu said.
Barclays economist Chang Jian said China's economic rebound would be moderate and external conditions could still affect economic policy in the near future. He expected China's fourth-quarter gross domestic product growth to pick up to around 7.8 percent from 7.4 percent in the third quarter.
China's economy showed signs of recovery with better-than-expected performances in September and October. Industrial production gained 9.6 percent annually last month, compared to 9.2 percent in September and August's 8.9 percent.
Among the 41 industries tracked by the national statistics bureau, 27 reported profits growth during January-October, led by the electricity generation and power supply industry, whose profits surged 57.5 percent.
IT machinery production profits expanded 10 percent in the first 10 months, and those of automobile manufacturing gained 9 percent.
Private business reported a profits growth of 17 percent to October, while those of foreign-invested firms and firms in Hong Kong, Macau and Taiwan slumped 9.2 percent.
State-owned enterprises said their profits also fell 9.2 percent during the first 10 months.
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