[Huatai Securities: Industrial Enterprise Profits Generally Improved in May, but Industry Differentiation Intensifies] A research report from Huatai Securities states that the profit growth rate of industrial enterprises in May slightly decreased to 21.1% from 24.7% in April, but remained higher than the 15.5% in the first quarter. Revenue growth continued to rebound, indicating an overall improvement in corporate profitability. Energy and AI-related industries were the main drivers of profit growth. However, with the Strait of Hormuz closure exceeding three months, the impact of supply shocks deepened, leading to further weakening of capacity utilization rates for some mid- and downstream enterprises, and intensifying the differentiation in industry profitability. While oil prices marginally declined in May, the overall profit growth rate of the upstream petrochemical chain remained high. Benefiting from strong global AI investment demand, the electronic computer industry continued to lead profit and revenue growth, increasing its contribution to overall industrial enterprise profits from 6.7 percentage points to 9.6 percentage points. Non-ferrous metal smelting and chemical products contributed 6.4 and 4.2 percentage points respectively, totaling approximately 20.2 percentage points. Meanwhile, downstream manufacturing industries related to domestic demand saw weak profit growth, particularly the automobile and furniture manufacturing sectors, where the decline widened further.
