event:
On December 27, the National Bureau of Statistics announced that from January to November, the profits of Industrial Enterprises above designated size increased by 38.0% year-on-year, with a compound growth of 18.9% over the two years, down from the growth rate from January to October.
Key investment points:
Core view: 1) in November, the profit growth of Industrial Enterprises above Designated Size returned to the downward trend, and the price drop was the main factor; 2) With the convergence of ppi-cpi scissors, the profits of industrial enterprises are gradually transmitted to the middle and lower reaches, and the profit differentiation of upstream and downstream industries tends to ease; 3) In November, the profit margin and profit proportion of the equipment manufacturing industry represented by metal products and electrical machinery increased significantly, and the boom recovery trend of the midstream manufacturing sector continued; 4) In November, the inventory level of industrial finished products rose again. Under the background of weak domestic demand, the characteristic of “passive inventory replenishment” continued.
In November, the cumulative profit growth rate of industrial enterprises decreased compared with the higher level of the previous month, and the marginal growth rate of the current month decreased. From January to January, the profits of national industrial enterprises above designated size increased by 38.0% year-on-year, with a compound growth of 18.9% in two years, down 4.2 and 0.8 percentage points respectively compared with the previous value, and the cumulative profit growth rate decreased significantly compared with the high growth level of last month. In a single month, the total profits of Industrial Enterprises above designated size decreased month on month in January, and fell to 9.0% from the previous value of 24.6% in the same month. After excluding the influence of the base, the two-year compound growth rate decreased significantly compared with the peak in October and reached the lowest point since April. On the whole, with the gradual recovery of global supply, the improvement of transportation efficiency and the strengthening of the policy of ensuring the supply and price stability of bulk commodities, the growth rate of PPI decreased, which led to the marginal decline of the profit level of industrial enterprises in November compared with the previous month, and the overall profit growth returned to the downward range.
Revenue growth stabilized, cost pressure differentiated, and the overall profit margin of industrial enterprises fell. In terms of revenue, from January to November, the operating revenue of Industrial Enterprises above designated size increased by 20.3% year-on-year, down 0.8 percentage points from the previous value, and the two-year compound growth rate was 9.74%, roughly equivalent to the previous value. On the one hand, with the support of export toughness and the temporary end of “orderly power consumption”, the average growth rate of industrial added value in November increased steadily in two years; On the other hand, the decline of PPI growth rate is one of the important factors restricting the revenue level of enterprises in November. In terms of cost, from January to November, the expenses and costs per 100 yuan of operating revenue of above designated industrial enterprises were 8.40 yuan and 83.72 yuan, slightly higher than the previous value. From the perspective of the three major categories of industry, the costs in 100 yuan of revenue of mining industry continued to fall in November, the cost rate of manufacturing industry stabilized, and the cost rate of revenue of public affairs continued to accelerate the upward trend. When the PPI fell in November, The cost side pressure of industrial enterprises has been differentiated. In terms of profit margin, the overall revenue profit of Industrial Enterprises above Designated Size in November was 6.98%, down from the previous month. From the perspective of subdivided industries, there are obvious structural differentiation in the level of profit margin. Among them, nearly 80% of the midstream manufacturing industries have improved their revenue profit margin month on month, including instruments and meters, special equipment, non-metallic mineral products, etc; In the upstream and downstream manufacturing industries, there are many industries whose profit margins have fallen, accounting for 63% and 45% respectively. The profit margins of the public utility industry have also generally declined.
From the perspective of industry profit distribution, the profit differentiation of upstream and downstream industries tends to converge, and the profit proportion of equipment manufacturing sector has increased significantly. Upstream industry in November (including mining industry and raw material processing industry) the cumulative proportion of profits was 24.94%, down 0.33 percentage points month on month in October, and the profit differentiation of upstream and downstream industries tended to converge. From the perspective of specific industries, the increase in the proportion of profits in November was mainly concentrated in the equipment manufacturing and consumer goods manufacturing sectors. At the upstream level, the profit structure of upstream industries was differentiated in November, and the raw material processing industry was affected by prices The impact of the decline is more obvious. The profit proportion of the overall sector decreased by 0.71 percentage points compared with the previous month, while the profit proportion of the coal mining industry in the mining industry continues to expand. At the midstream level, benefiting from the decline of cost pressure, the profit proportion of midstream manufacturing sector represented by equipment manufacturing rebounded as a whole. Among them, the electrical machinery, metal products and electronic equipment industry improved month on month, and the growth rate of profit proportion was 0.18, 0.14 and 0.08 percentage points respectively. At the same time, the profit of industrial products manufacturing sector was stable in November, in which the profit proportion of non-metallic mineral manufacturing industry increased slightly. At the downstream level, with the convergence of ppi-cpi scissors difference, the decline in the profit proportion of consumer goods manufacturing sector narrowed in November, and the profit proportion of agricultural and sideline food processing, food manufacturing, textile and garment industries gradually rebounded, but the profit proportion of wine, beverage and pharmaceutical manufacturing industries is still declining.
From the perspective of two-year compound profit growth of subdivided industries, the growth of upstream sectors slowed down, but it is still the main force driving the profit growth of industrial enterprises, and the profit growth of most middle and downstream industries improved. From the perspective of the three major categories of industry, the compound profit growth rates of mining, manufacturing and public utilities from January to November were 38.56%, 19.46% and – 13.26% respectively. Compared with January to October, the mining industry increased by 3.57 percentage points, the manufacturing industry decreased by 0.89 percentage points and the public utilities decreased by 5.84 percentage points. The upstream sector is still the main force driving the profit growth of industrial enterprises. In terms of specific industry segments, Industries with cumulative profit growth rate of more than 40% in two years from January to November include black mining and beneficiation (76.28%), nonferrous smelting (65.87%), petroleum coal processing (65.16%), coal processing (56.07%), chemical fiber manufacturing (54.00%) and chemical raw material manufacturing (49.40%), of which the upstream industries still occupy many seats. From the month on month change of subdivided industries, the cumulative profit growth of 19 industries improved in November, including 12 middle and downstream industries. The equipment and consumer goods manufacturing sector accounts for the majority. The profit growth of textile and garment, transportation equipment, tobacco products and metal products industries ranks first, and the cumulative profit growth rate in the two years Increased by 3.70, 2.55, 1.51 and 1.05 percentage points respectively. At the same time, the profit growth of PetroChina coal processing, chemical fiber manufacturing and ferrous metal smelting industries in the middle and upper reaches fell significantly, down 13.45, 8.17 and 6.48 percentage points respectively.
The profit structure of industrial enterprises has improved, and the boom recovery trend of the midstream manufacturing sector is expected to continue. In November, with the effective implementation of the policy of ensuring supply and stabilizing price and the spread of the tide of price increase of consumer goods, the profits of industrial enterprises gradually transmitted to the middle and lower reaches, and the differentiation and convergence of profits between the upper and lower reaches is the main feature. At the early stage of ppicpi convergence, the profitability of the midstream manufacturing industry was given priority to improve. In November, the profit margin and profit proportion of the equipment manufacturing sector increased significantly. Looking forward to next year, on the one hand, under the stable growth policy environment, the manufacturing investment is expected to maintain a high growth, with the further decline of superimposed cost pressure, and the boom recovery trend of the midstream manufacturing industry is expected to continue. On the other hand, there is still downward pressure on the economy in the first quarter of next year. Demand is the biggest factor restricting the profit growth of middle and lower reaches enterprises. We still need to pay attention to the negative impact of the decline of foreign demand on manufacturing enterprises.
The inventory level reached a new high, and industrial enterprises continued to passively replenish inventory. In November, the finished product inventory of Industrial Enterprises above designated size increased by 17.9% year-on-year, an increase of 1.6 percentage points over October, continuing the characteristics of “passive replenishment of inventory” last month. After opening the gate to limit electrolysis, the production of industrial enterprises resumed, but under the background of weak domestic demand, the inventory level of finished products of industrial enterprises hit a new high this year.
Risk tips: liquidity tightening is more than expected, economic stall is down, and the epidemic situation is worse than expected
