CITIC Securities says April industrial firms posted new highs in both profit and
revenue growth. Price gains and margin improvement—anchored by a
stronger-than-expected PPI recovery—are the main drivers, while a weak volume
recovery is dragging. State-owned and joint-stock firms led profit gains;
foreign-funded firms’ profit growth slowed marginally. By sector, upstream
Profits surged, midstream profit share rose and downstream profits ticked up;
coal, nonferrous metals, computer & communications and chemical raw materials
outperformed, with coal showing marked margin recovery. Firms’ inventory
restocking intentions are rising, but the report flags risks from shifts in
external demand and from raw-material price increases weighing on production
expansion and medium-to-long-term profits.
