The National Bureau of Statistics released the profit data of industrial enterprises from January to September on the 27th. From January to September, the profits of industrial enterprises above designated size increased by 3.2% year-on-year, the highest cumulative growth rate since August last year; Compared with the period from January to August, it has accelerated by 2.3 percentage points, showing a trend of accelerated recovery. From January to September, various regions and departments conscientiously implemented more proactive and proactive macro policies, cultivated and strengthened new economic growth points, and the high-tech manufacturing industry, equipment manufacturing industry and other new quality productive forces grew rapidly. Coupled with the impact of the low base effect, the profit growth rate of industrial enterprises above designated size continued to rebound. ”Yu Weining, a statistician from the Industrial Department of the National Bureau of Statistics, explained. Data shows that in September, the profits of industrial enterprises above designated size increased by 21.6% year-on-year, accelerating by 1.2 percentage points compared to the previous month. The acceleration of industrial profit growth in September was mainly driven by factors such as a low base and stable volume, slow prices, and a rebound in profit margins compared to the same period last year. ”Wen Bin, Chief Economist of Minsheng Bank, stated. Zhang Di, Chief Macro Analyst at Galaxy Securities, believes that the unexpected increase in production in September is the main reason for the improvement in profits, as evidenced by the three factors of volume, price, and profit margin. PPI and profit margin have also continued to rebound. Industrial production significantly increased in September. The year-on-year growth rate of industrial added value in September was 6.5%, an increase of 1.3 percentage points compared to August. Zhang Di pointed out that on the one hand, there has been a seasonal rebound in production during the "Golden September and Silver October" period, and on the other hand, the growth rate of exports has significantly increased due to the sustained recovery of the global economic prosperity and the promotion of market diversification strategies, driving up production. Looking at different industries, from January to September, 23 out of 41 major industrial sectors saw a year-on-year increase in profits, with a growth rate exceeding 50%; Among them, 30 industries saw profit growth in September, with a growth rate of 73.2%. From the perspective of recovery, from January to September, there were 26 industries where the profit growth rate accelerated or the decline narrowed compared to January to August, and the recovery rate exceeded 60%. In September, in terms of profitability by industry category, the manufacturing industry played a significant role in improving the profits of industrial enterprises. The year-on-year growth rate of manufacturing industry profits rebounded to 29.4%, the year-on-year decline in mining industry profits narrowed to -16.8%, and the year-on-year growth rate of public utility profits fell sharply to 19.3%. From the perspective of upstream, midstream, and downstream in the manufacturing industry, the growth rate of midstream profits in September significantly rebounded and remained above 20%, while the growth rate of upstream profits remained basically unchanged, and the growth rate of downstream profits fell back to 10%. The midstream industry remains the main driver of the year-on-year increase in profits in September. ”Yu Bo, Chief Macro Analyst at Changjiang Securities Research Institute, said. In Yu Bo's view, the rebound in year-on-year profit growth this month is mainly attributed to two factors. On the one hand, the high profit growth in the export chain industry has a significant impact on the overall growth. Among them, computer electronics, automobiles, and general equipment combined have driven a year-on-year profit growth of 8.1 percentage points and a year-on-year revenue growth of 2.1 percentage points, reflecting that external demand is still an important variable supporting enterprise profit growth. On the other hand, the recognition of investment income from state-owned enterprises may still make an effective contribution to the monthly profit growth. In September, the profits of state-owned enterprises increased by 12.7% year-on-year. Although the high base of the previous month has fallen, it is still the second highest since 2025, especially in the power and heat supply industry. Although it dragged down the year-on-year growth rate of revenue by 0.17 percentage points, it drove the year-on-year growth rate of profits by 2.3 percentage points. In terms of inventory, at the end of September, the nominal year-on-year growth rate of finished product inventory in industrial enterprises rebounded to 2.8%, while the actual year-on-year growth rate of inventory fell back to 5.2%. Combined with the year-on-year growth rate of export delivery value in September, which rebounded to 3.8%, reflecting the weak domestic demand environment, the growth of external demand effectively drove inventory turnover, and the overall trend was positive. From the two inventory indicators of PMI, the inventory index of raw materials in September was 48.5%, and the inventory index of finished products was 48.2%, which increased by 0.5 and 1.4 percentage points respectively from the previous values. Wen Bin pointed out that although it is still below the boom bust line, there are clear signs of marginal recovery, indicating that companies are rationally replenishing their inventory and maintaining good production sales matching under the background of improved profits and market demand recovery. Wen Bin believes that it is still in the stage of low-level recovery, and the main focus of enterprise replenishment is to maintain production and sales balance. The obvious turning point of large-scale active replenishment still needs more positive signal support. In terms of account settlement, the accounts receivable of industrial enterprises from January to September were 5.7% year-on-year, a decrease of 0.9 percentage points from the previous value, and fell below 6% for the first time since 2020. Since September, various regions have been promoting the repayment of overdue corporate accounts through "special bonds+special loans", and funds have flowed from the government to the owed enterprises. From the deposit data, the newly added fiscal deposits in September decreased by 840 billion yuan, a year-on-year decrease of 600 billion yuan, which is consistent with the trend of a year-on-year decline in corporate accounts receivable. Overall, Wen Bin believes that driven by the low base effect, profit margin recovery, and structural price repair, the profits of industrial enterprises above designated size increased by 3.2% year-on-year from January to September, up 2.3 percentage points from January to August, indicating that industrial enterprise profits are accelerating their recovery. From a trend perspective, due to the low profits in October and November last year and the increase in the base in December, as well as the narrowing of the PPI decline and improvement in the marginal profit margin of enterprises driven by the "anti involution" policy, Wen Bin expects the profit growth rate in the fourth quarter to be "high in the beginning and low in the end". Short term high growth is difficult to sustain, but the cumulative growth rate is still expected to steadily increase. In the communiqu é of the Fourth Plenary Session of the 20th Central Committee of the Communist Party of China, it was emphasized that "we must adhere to the strategic basis of expanding domestic demand, adhere to the close combination of benefiting people's livelihoods and promoting consumption, investing in goods and investing in people, lead new supply with new demand, and create new demand with new supply". Yuan Haixia, President of China Chengxin International Research Institute, expects that policies to boost domestic demand will continue to be introduced and gradually implemented in the future, and the improvement of domestic demand will become one of the decisive factors for the improvement of corporate profits in the fourth quarter. (New Society)