Chengdu Derbo Steel Co.,Ltd

Industrial profit growth or will continue to fall

Industrial profits continue to maintain a good momentum of growth. National Bureau of Statistics recently released industrial enterprise financial data show that in 2017 from January to April, above-scale industrial enterprises total profit rose 24.4% year on year growth rate of 3.9 percentage points from January to March; which, in April profit growth of 14 %. Experts said the steel, automotive and chemical industries and other industries profit growth slowed down, is the main reason for the decline in overall data, but the overall current industrial profits remain good growth. Looking ahead, the relationship between supply and demand determines the price of products is more difficult to further rise, resource class, high energy consumption manufacturing industry profit growth or will gradually fall, thus driving the growth rate of industrial profits continue to fall.

"Industrial profit growth slowed down, is the early high growth after a reasonable return.Overall, the current industrial profits still maintain a good momentum of growth." National Bureau of Statistics Industry Secretary Dr. He Ping said that industrial profits not only maintain a good momentum, Benefit indicators are also improving. Among them, consumer goods manufacturing and high-tech manufacturing industry to enhance the role of profit growth. In April, all industrial enterprises above designated size increased profits, consumer goods manufacturing accounted for 21.6%, compared with March increased by 9.8 percentage points; high-tech manufacturing accounted for 23.2%, an increase of 19 percentage points.

Bank of China International Finance Research Institute researcher Liang Jing said that in April, consumption, investment, import and export and other indicators were slowed down last month, the slowdown in demand also led to industrial production and sales slowdown, April Enterprise main business income grew 13.5%, down 0.5 percentage points from last month. However, food, wine, beverage, entertainment and other consumer goods manufacturing industry profit growth has accelerated, pharmaceutical manufacturing, computer communications, electronic equipment and other high-tech manufacturing industry profit growth accelerated, while some equipment manufacturing industry profit growth remained high Level.

It is worth mentioning that the early impact of the larger price factors on the contribution of profit growth has declined, the product prices and purchase price of raw materials to the normal return. Due to price increases fall, rising costs and other effects, steel, automotive and chemical industries such as profit growth slowed down significantly.

In addition, Founder Securities chief economist Ren Zeping said from the data that the financial leverage to the impact of corporate financing costs rise significantly, in March the company's financial costs from the continued decline to growth in April corporate financial costs year on year growth Expand 1.2 points to 4.2%. And it is because of sales down, the price callback, inventory back to the end of the financing costs rise and other reasons, industrial enterprises profit growth was high down.

Liang Jing that the future growth of industrial profits or will continue to fall. In the future, the relationship between supply and demand determines the price of the product is more difficult to rise further, the interest rate is easy to rise and fall, industrial purchase price increases continue to be higher than the product prices will affect the cost of business, coupled with the previous year base, Industry profit growth rate or will gradually fall, thus driving the growth rate of industrial profits continue to fall.

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