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China's A-share markets have started their annual reporting season. More than 1,400 companies had revealed their financial reports for 2017, including heavyweight sectors like banking, airlines, telecommunications and manufacturing. Some 1,039 companies of those, accounting over 70 percent, reported profit increases.
Beverages, home appliances, steel, non-ferrous metals and coal were among the best performing sectors. Experts attribute much of their growth to continued supply-side reforms.
The main board has seen clear growth in revenue, according to Hong Hao, chief strategist of BOCOM International. Estimates put growth rate at around 18 percent for 2017, much higher than the five-percent growth a year earlier.
"In general, corporate leverages remain stable… and most importantly, the earnings’ growth on the main board is picking up because of the supply-side reform," Hong noted.
In terms of revenue, petroleum giants dominate the list.
SinoPec and PetroChina are the top two with both companies' revenues exceeding two trillion yuan (some 317 billion US dollars). Ping An Insurance ranks third with a revenue close to 900 billion yuan (142 billion US dollars). The three companies' combined revenue accounts for more than 40 percent of the top 20 companies on the list.
Banks are also absolute winners in terms of net profits.
The Industrial and Commercial Bank of China (ICBC) has made 287 billion yuan (around 45 billion US dollars) in net profits last year. It is followed by China Construction Bank with 244 billion yuan (38 billion US dollars) and Agricultural Bank of China with 193 billion yuan (30 billion US dollars).
"2017 was the second year of the supply-side reforms. We can see a recovery of performance in bluechips in the financial, steel, petroleum, and coal mining sectors. However, since the base 2017 is now set pretty high, we estimate growth will come back to 15-20 percent for 2018. But that's still looking good," said Yang Xiaolei, senior analyst at SWS Research.
(CGTN)
