Profit gains continue at mainland factories

Profits continued to grow at mainland manufacturers last month on the back of lower raw material prices and following Beijing's approval of more infrastructure investment projects, a move aimed at spurring the economy by offsetting weaker export growth.

Earnings at companies with annual sales of at least 20 million yuan (HK$24.57 million) leaped 22.8 per cent to 638.5 billion yuan in November from a year earlier, the National Bureau of Statistics said yesterday.

It marks the third straight month of gains, and outpaced October's 20.5 per cent rise, and September's 7.7 per cent increase. September's gain was the first in six months, after profits were squeezed by weak overseas and domestic demand, as well as the high-cost inventory of raw materials that were procured earlier.

For the first 11 months of the year, industrial profits increased 3 per cent to 4.66 trillion yuan from the year-earlier period.

Analysts attributed the pickup in growth of industrial profits in recent months partly to the fact that growth in the previous corresponding months was held down by Beijing's efforts to stifle property speculation and contain inflation.

Sharp falls in commodities prices, which lowered raw material prices, also boosted profit in recent months.