Core conclusions:
A-wide profit growth has declined for four consecutive quarters. The net profit attributable to the parent company of all A-Shares (non-financial two oils) in 2022q1 increased by 6.29% year-on-year, down 14.05pct from the cumulative year-on-year growth at the end of last year, and showed an accelerated downward trend.
The growth rate of net profit on the main board is stronger than that on the gem, with expanded advantages. The year-on-year growth rate of the parent net profit of the main board 2022q1 was 3.64%, and that of the gem was – 5.23%. The profit growth rate of the main board was 8.87pct higher than that of the gem, and the advantage margin of profit growth was expanded. In addition, the growth rate of gem profits turned negative in 2022q1, the first time since the second quarter of 2020.
The prosperity of the industry has changed from differentiation to convergence, and the cycle continues to decline from a high level. The consumption must be improved month on month.
The net profit attributable to the parent company of the cycle sector 2022q1 increased by 44.0% year-on-year, an increase of 85.42 percentage points month on month compared with the cumulative growth at the end of last year, which was a decline for three consecutive quarters. The year-on-year growth rate of the net profit attributable to the parent in 2022q1 of the mandatory consumption sector was – 0.35%, an increase of 8.66 percentage points compared with the cumulative growth rate at the end of last year. It is the only sector in all sectors to achieve the improvement of net profit growth month on month.
The profit growth difference between the middle and lower reaches and the upper reaches showed marginal improvement. The 2022q1 profit growth of the consumer sector is 46.90 percentage points lower than that of the cycle sector, narrowing the gap compared with last year’s annual report. The profit growth rate of the midstream manufacturing sector in 2022q1 is 34.68pct lower than that of the cycle sector, slightly widening the gap compared with 34.22pct in last year’s annual report, but the slope slows down significantly.
From the perspective of industry segmentation, the industry boom of 2022q1 has moved from differentiation to convergence. 1) The revenue growth and profit growth of the cyclical sector both fell, leaving only gold and coal with performance toughness; The proportion of single quarter net profit of the cycle sector in the whole a fell from a high level, ending the continuous upward trend in the past two years. 2) In the midstream manufacturing industry, the profit growth rate of traditional manufacturing industry has fallen for four consecutive quarters. The profit growth rate of high-end manufacturing industries such as military industry and electrical equipment is the same. Last year, the contrarian rise of 2021q3 has not been maintained so far. 3) In the consumption sector, the growth rate of the net profit of traditional Chinese medical devices, Baijiu and white household appliances increased month on month. The growth rate of the net profit of other mandatory consumer industries fell by about 10PCT, and the growth rate of the net profit of other optional consumer industries fell by about 30pct.
The return on net assets of all a continued to fall, and the asset turnover rate and equity multiplier together constituted a drag.
Roe (TTM) of all A-Shares (non-financial two oil) was 7.31%, which has fallen for three consecutive quarters, but the decline in 2022q1 slowed down. From the impact factors of roe, the net profit margin of all A-Shares (non-financial two oil) increased slightly month on month compared with the end of last year, the equity multiplier decreased by 0.032 month on month, and the asset turnover rate decreased by 0.002 month on month.
1) in terms of sectors, the upstream periodic sector is the only sector whose roe is still rising, but the upward slope slows down. The roe margin of the required consumption sector stabilizes. For the first time, the roe of TMT sector decreased month on month, and the decline of roe of optional consumption sector did not converge. 2) In terms of subdivided industries, the industries in which roe continues to rise include mining, chemical industry, non-ferrous metals, electrical equipment and national defense industry. However, compared with history, by 2022q1, the number of industries in which roe can rise for several consecutive periods has been significantly reduced. The industries in which roe weakened for the first time in this quarter include textile and clothing, leisure services, electronics and media.
