Beijing, Oct. 28 (Xinhua) (Reporter Wei Xia Yi Ban Juanjuan) The National Bureau of Statistics 27 released January to September national industrial enterprises above designated size profit data. The data show that China’s production demand has gradually recovered, the industrial cycle has continued to improve, and the profits of industrial enterprises have risen steadily. Among them, the third quarter profit growth of 15.9%, 11.1 percentage points faster than the second quarter. The number of industries with profit growth increased significantly, and the profit growth rate of 24 industries exceeded double digits, and the key industries such as automobiles and construction machinery in the field of equipment manufacturing pulled significantly.

Industry profits improved quarter by quarter and profitability further improved

Overall, thanks to the coordinated progress of epidemic prevention and control and economic and social development, production and sales of industrial enterprises are recovering rapidly. Zhu Hong, senior statistician of the industrial department of the National Bureau of Statistics, said that in the third quarter, the value added of industrial enterprises above designated size increased by 5.8% year on year, and the operating income increased by 4.8%, which showed a rebound trend from quarter to quarter. Driven by the steady recovery of income, the profit growth rate of industrial enterprises fell by 36.7% in the first quarter, increased by 4.8% in the second quarter, and then accelerated to 15.9% in the third quarter, showing a trend of “from decline to rise, and growth accelerated”.

Since the third quarter, the prosperity of many industries has rebounded significantly, and the profitability has been further improved. On the other hand, the loss of enterprises also fell sharply, and the loss of industrial loss-making enterprises above designated size fell by 21.4% year-on-year, compared with an increase of 13.1% in the second quarter. At the end of September, the loss of enterprises was 3.9 percentage points lower than that at the end of June.

Zhu Jianfang, chief economist at CITIC Securities, expects the profits of industrial enterprises above designated size to achieve a small positive growth for the whole year. The number of booming industries continued to increase, especially the equipment manufacturing industry and raw material manufacturing industry in the third quarter, driving the cumulative profit of the overall manufacturing industry to turn positive as scheduled.

Specifically, in the third quarter of 31 industries with a year-on-year increase in profits, 24 industries have a double-digit profit growth rate. Among them, the industries with the most new profits are mainly: The automobile manufacturing industry grew by 53.8%, the non-ferrous metal smelting and rolling processing industry by 52.0%, the ferrous metal smelting and rolling processing industry by 39.1%, the general equipment manufacturing industry by 32.4%, the electricity and heat production and supply industry by 22.4%, and the electrical machinery and equipment manufacturing industry by 16.8%. These six industries together drove the profits of industrial enterprises above designated size up by 10.0 percentage points year-on-year in the third quarter.

The equipment manufacturing boom continues to be optimistic about automobiles and construction machinery

Benefiting from a number of policy supports such as the switch of environmental standards, the acceleration of infrastructure projects and the promotion of consumption, the equipment manufacturing industry has continued to perform well since the second quarter. In the third quarter, the profit of the equipment manufacturing industry increased by 22.5% year-on-year. Among them, automobiles, general equipment and special equipment increased by 26.0%, 28.2% and 63.5% in the quarter, respectively, and continued to maintain a rapid growth of more than 20% in the third quarter.

Car sales rose 12.8 per cent in September from a year earlier and 17.4 per cent from the previous month, according to CAAM. Among them, passenger car sales achieved the fifth positive monthly growth since May. In addition, in the first nine months of this year, the cumulative sales of heavy trucks in the overall market increased by 39%, and from April to September, it achieved “six consecutive rises”.

Zheshang Securities analyst Wang Jing believes that passenger car sales for three consecutive months double-digit growth, three, four and five tier city demand has recovered, industry demand is expected to pick up in the fourth quarter of passenger car sales is expected to increase by more than 10%, 2021 annual sales growth is expected to reach 12%-15%. Boc Securities also pointed out that with the continuation of favorable policies around the country and the recovery of demand for construction vehicles driven by infrastructure, auto sales are expected to continue to improve in October, and are expected to usher in an upward cycle lasting 2-3 years.

The field of machinery and equipment, which ranks first in profit growth, is also continued to be optimistic. The recovery of the automobile and 3C manufacturing industry is expected to increase the willingness of manufacturing enterprises to expand production and stimulate the demand for industrial robots. According to the National Bureau of Statistics, the output of industrial robots in September was 23,194 sets, a sharp increase of 51.4% year-on-year, and the growth rate hit a new high since 2018. Wanlian Securities believes that in the long run, the domestic industrial robot market has great potential under the background of industrial upgrading and aging population, industrial robots have penetrated into the general industrial field, and the industrial chain has ushered in a good opportunity for localization.

The performance of the construction machinery industry with strong fundamentals is also very eye-catching. In the first nine months of 2020, the demand for domestic infrastructure, new energy and other downstream industries remained high, and the industry showed the characteristics of “delayed peak season and not weak off-season”. In September, excavator and forklift sales increased by 65% and 72%, respectively, continuing to exceed expectations. Zoomlion, which is about to disclose its third-quarter results, said it expected to achieve a net profit of 5.5 billion to 5.8 billion yuan in the first three quarters, an increase of 58% to 67%. According to the third quarterly report of the domestic forklift leading manufacturer Hangfork Group, the operating income of 8.208 billion yuan in the first three quarters of 2020, an increase of 21.61%; Net profit returned to the mother was 627 million yuan, an increase of 31.06%.

Pacific Securities said that the current construction machinery fundamentals are still strong, is expected in October excavator sales growth of more than 50%, the fourth quarter is still high growth. Under the background of the industry sales data is still strong, the leading enterprises with higher performance than expected continue to be optimistic. (over)