Gaurav Dogra
(Reuters) – Chinese firms are expected to report the highest revenue growth in five years as the economy reopens after COVID lockdowns and accommodative monetary policy.
According to Refinitiv IBES data, China’s large and mid-cap profits are expected to rise 16.2% in 2023, the fastest growth since 2017. This analysis is based on his 1,164 companies with a market capitalization of at least $1 billion. (Graphic: China-based companies net income growth, https://fingfx.thomsonreuters.com/gfx/mkt/zjpqjeewrvx/Net%20income%20growth%20for%20China%20based%20companies.jpg)
Optimism is mounting after China reopens after maintaining a strict zero-coronavirus policy for three years, with Beijing pledging additional policy support to boost its ailing domestic economy.
Gerald van der Linde, head of equity strategy at HSBC, said the easing of COVID-19 restrictions and support from the property market should boost the outlook for mainland China’s consumer and travel-related sectors. rice field.
Utilities, consumer staples and consumer goods sectors are expected to lead the growth with estimated profit growth of 34.5%, 33.5% and 27.8% respectively, according to a Reuters analysis.
Meanwhile, technology sector revenues are expected to grow by 27% from 9.4% in 2022, while real estate sector revenues are expected to increase by 9.4% after a 4.9% decline last year.
(Graphic: Chinese companies net profit growth breakdown by sector, https://fingfx.thomsonreuters.com/gfx/mkt/xmpjkllrzvr/Breakdown%20by%20sector%20for%20Chinese%20companies%20net%20income%20growth.jpg )
E-commerce company JD.com and technology infrastructure and marketing platform provider Alibaba Group are expected to report earnings growth of 28.8% and 18.3% respectively.
Tech giant Tencent Holdings’ earnings are expected to rise by about 19% this year after a slump in 2022.
Mark Häfele, chief investment officer at UBS Global Wealth Management, said: “China is poised to move ahead of Japan, with a faster-than-expected economic reopening, continued domestic policy support, and the potential for stronger earnings growth. We expect it to surpass Asia,” he said. Moon.
(Reporting by Gaurav Dogra, Bangalore; Additional reporting by Patturaja Murugaboopathy, Bengaluru; Editing by Vidya Ranganathan and Tomasz Janowski)
