This photo taken on May 23, 2024 shows CHINT Group's Shanghai transformer factory in Songjiang District of east China's Shanghai. Photo: Xinhua

Profits of China's industrial firms above the designated size increased 3.4 percent between January and May from a year earlier, reflecting that industrial profits have continued to recover with the support of a range of targeted pro-growth policies, official data showed on Thursday. 

Industrial firms with yearly business revenue of at least 20 million yuan ($2.75 million) saw their combined profits reach 2.75 trillion yuan between January and May, according to data released by the National Bureau of Statistics (NBS).

NBS statistician Yu Weining said as China continues to improve macroeconomic policies to boost the economy, adding that both market demand and industrial production have further improved, resulting in a sustained recovery in enterprises' profits.

Due to short-term effects such as slow growth rate of investment yields, the figure for January-May period contracted 0.9 percentage point compared with the first fourth months. However, major industrial enterprises' total profits grew 0.8 percentage points faster than that recorded in the first four months, underscoring sustained recovery of industrial companies, according to Yu.

Among the 41 industrial categories monitored by the bureau, 32 recorded growth in profits.

Driven by the relatively rapid development of sectors including smart phones, high-tech vessels and automobiles, the country's electronics industry reported robust profit gains, which surged 56.8 percent year-on-year during the January-May period.

The profits of the equipment manufacturing sector, the largest contributor to the overall major industrial profit growth, expanded by 11.5 percent from one year earlier, the data showed.

Yang Chang, chief analyst at Zhongtai Securities Research Institute, told the Global Times on Thursday that major industrial enterprises profits continued to rise in May, but their inventories continue to grow, indicating weak domestic demand.

He said private enterprises and State-owned enterprises posted stable performance in May while foreign-funded enterprises reported a drop in profits.

Yu said that the industrial profits had maintained its upward trend, but that the recovery remained uneven, and more efforts should be taken to promote the development of new quality productive forces, accelerate the building of a modernized industrial system, and expand domestic demand to consolidate the foundation of economic recovery.