The Chinese industrial firms have reported profits of 895.2bn Chinese renminbi in December 2012, a growth of 17.3 per cent compared to same period a year ago, marking the third month of double-digit growth.
Profits of industrial companies owned or controlled by the Chinese government, declined for in 2012 by 5.1 per cent to 1.42tn renminbi.
Stephen Green, head of research for Greater China at Standard Chartered bank, told the Financial Times: “We expect industrial profits to rise 30 per cent in 2013 on average. We expect year-on-year profit growth to peak in the third quarter.”
Green said surging investment in infrastructure and real estate, a mild rebound in export demand from China, cheaper raw materials, looser monetary conditions and a lower base in 2012 will all support faster profit growth this year.
The world’s second-largest economy saw an economic growth of 7.8 per cent in 2012.
In its survey of 41 sectors, the National Bureau of Statistics in China, saw rise in profits among 29. However, steel and chemical companies saw decline in profit of 37 per cent and 6 per cent in 2012 compared to a year ago.
Sector wise, profits of power generation firms grew 69 per cent, while food processing companies saw a profit growth of nearly 21 per cent, and electrical equipment makers profits grew 8 per cent.
Meanwhile, private sector total realised profits rose 20 per cent from a year earlier to 1.82tn renminbi.
Lou Jiwei, head of China’s main sovereign wealth fund, told a forum that growth was likely to exceed 8 per cent this year and would be a key support for global demand amid a “mild, tortuous and slow recovery” in the world economy.
The world’s second-largest economy has taken proactive steps to improve investment and infrastructure by liberalising its monetary policy in 2012.