Workers at a construction site in Wuhan, Hubei province, on March 26, 2020. Photo: Xinhua/Cheng Min

Profits from China’s major industrial firms slumped in the first two months of 2020 as the novel coronavirus outbreak dealt a huge blow to industrial production, according to data published by the National Bureau of Statistics on Friday. 

Profits from industrial companies above a designated scale totaled 410.7 billion yuan (about US$58.67 billion) in the first two months, down 38.3% from the same period of last year, the NBS said in a statement.

Many industrial companies suspended operations during February in response to Covid-19, resulting in a significant decline in production and sales, said Zhang Weihua, an NBS official.

Factors including rising costs, lower prices of industrial products and reduced profit margins for most industrial sectors also contributed to the drop, Zhang said.

Profits in 37 of the 41 industrial sectors surveyed fell compared with one year earlier, according to the NBS. Industrial firms in the manufacturing sector saw combined profits slump by 42.7% year on year, while firms in the mining industry registered profit decline of 21.1 %.

Profits of state-owned industrial firms dropped 32.9% from one year earlier while that for private companies fell 36.6%.

Central bank bills

The People’s Bank of China (PBoC), China’s central bank, issued 10 billion yuan (US$1.43 billion) worth of 6-month yuan-denominated central bank bills in Hong Kong at a rate of 2.19% on Thursday.

The bills were oversubscribed with a combined capital of more than 35 billion yuan, which was about 3.5 times of the total issuance amount. The PBoC said overseas investors welcomed the bills as global financial markets remained volatile.

IPO markets

In the first quarter, the number of initial public offerings (IPOs) and the amount of capital raised in the Greater China region increased by 34% and 104%, respectively, from the same period of last year, according to a research report published by Ernst & Young.

There were 52 A-share IPOs in Shanghai and Shenzhen stock markets with a combined fundraising size of US$11.3 billion. Both figures ranked No 1 globally. In Hong Kong, the number of IPOS totaled 38, while the fund-raising size reached $1.8 billion.

Industrial enterprises continued to dominate the IPO market in China, followed by technology and healthcare companies.

Water conservancy projects

The construction of 142 out of 172 major water conservancy projects has commenced with a combined investment size of more than 1 trillion yuan, according to the Ministry of Water Resources.

Every 100 billion yuan investment in major water conservancy projects can drive GDP growth by 0.15 percentage points and create 490,000 new jobs, according to a research report published by the China Macroeconomic Research Institute.

Company news

Zhejiang Mobile and Huawei Technologies have jointly completed a test of an 800G optical transmission network in Huzhou, Zhejiang Province. The 800G network has the largest single-fiber capacity in the world. It can effectively support the development of 5G, big data, cloud computing and other services.

Sunac China said in its 2019 annual report that its apartments for sale could be worth up to 820 billion yuan this year, similar to the amount last year, if the Covid-19 epidemic continues to gradually fade out in mainland China.

Guangdong Kaipu Yun Information Technology, a Dongguan-based big data service provider, debuted on the Shanghai Stock Exchanges Science and Technology Innovation Board on Friday. The company’s chairman Wang Min said the company has been committed to developing digital content management and big data technologies for 20 years. Wang said the company will focus on new infrastructure projects and help local governments digitalise their operations.

The story was written by Huang Wanyi and Xu Jiangshan and first published at