Chinese companies set for biggest earnings growth in 5 years in 2023: Refinitiv data
Chinese companies are expected to report their highest earnings growth in five years, Refinitiv data shows, as economic reopening after Covid lockdowns and accommodative monetary policy raise hopes for higher profits.
According to Refinitiv IBES data, China’s large and mid-cap companies’ profits are seen rising 16.2% in 2023, the fastest growth since 2017. The analysis is based on 1,164 companies with a market capitalisation of at least $1 billion.
Optimism has risen after China reopened following three years of maintaining a strict zero-Covid policy and Beijing pledged additional policy support to boost the ailing domestic economy.
Herald van der Linde, head of the equity strategy at HSBC
The Reuters analysis showed utilities, consumer staples and consumer discretionary sectors are expected to lead growth with their estimated profit growth of 34.5%, 33.5% and 27.8%, respectively.
Meanwhile, the tech sector is expected to see earnings growth of 27% compared with 9.4% in 2022 while the property sector would witness 9.4% higher profits after a 4.9% drop last year.
E-commerce company JD.com and technology infrastructure and marketing platforms provider Alibaba
Profits of tech giant Tencent
“We expect China to outperform Asia ex-Japan due to its faster-than-anticipated reopening, continuing domestic policy support, and potential for stronger earnings growth,” said Mark Haefele, chief investment officer at UBS