(Yicai Global) July 27 -- Profits at China’s large industrial companies steadily improved in the first half, but smaller private firms have not fared as well, according to the latest data. 

For large industrial firms -- those with annual income of at least CNY20 million (USD3.1 million) from their main business -- profits surged an average 67 percent in the first six months from a year ago, and rose 46 percent from the same period in 2019, according to data released by the National Bureau of Statistics today.

Last month, their combined profits jumped 20 percent from a year earlier to CNY791.8 billion (USD121.8 billion).

Big private businesses logged CNY1.22 trillion (USD187.79 billion) in first-half profits, an annual rise of just over 47 percent, while large state-owned enterprises achieved profits of CNY1.38 trillion, more than double the figure for last year. 

The data appeared to show three main trends, Zheng Houcheng, director of Yingda Securities' research institute, told Yicai Global. The results were better for upstream companies than downstream ones, SOEs did better than private ones, and the mining industry is doing better than the manufacturing sector, Zheng said, adding that these trends are likely to continue in the short term given the continuing upward momentum in international oil prices and the high costs of both non-ferrous and ferrous metals. 

Profits for firms in the upstream mining industry and the raw material production sector grew sharply in the first six months, rising by 1.33 and 1.83 times, respectively.

Zhu Hong, a senior statistician at the NBS, said there was an imbalance in the recovery of corporate profits, as private small and micro firms have seen slower improvement. This is partly because commodity prices are still high, and there are weak points in the industrial and supply chains, Zhu said. 

Wu Chaoming, chief economist at Caixin Securities, said the recovery will continue in the third quarter but at a slower pace, as the cost pressure for mid-stream and downstream firms as well as smaller companies will not support a sustained surge in profits.

Editors: Xu Wei, Tom Litting