Bloomberg "October Profit Growth Rate of Chinese Companies Hits Highest in 9 Years"

Citing China's National Bureau of Statistics... Base Effect Impact
Cash Pressure May Increase Going Forward

[Image source=AP Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] Last month, the profit growth rate of Chinese industrial enterprises recorded the highest level in nine years for October, Bloomberg reported on the 27th.

According to the report, the National Bureau of Statistics of China announced that industrial enterprises' profits increased for six consecutive months in October, rising 28.2% compared to the same period last year. This trend is largely attributed to the base effect caused by low profits last year. The profit growth rate from January to October this year is about 0.7%.

Although corporate profits increased in October, the outlook remains somewhat cautious. Zhu Hong, an economist at the National Bureau of Statistics, explained, "There is increasing pressure on cash flow, such as a rising rate of accounts receivable for industrial enterprises," adding, "In the long term, corporate profits may face downward pressure."

While the profit growth rate of Chinese state-owned enterprises decreased by 7.5% year-on-year from January to October this year, private enterprises showed a 1.1% increase.

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