Bank of China Securities·2025-06-30 13:36Core Insights - The report highlights a decline in the total profit of industrial enterprises in China, with a year-on-year decrease of 1.1% for the first five months of 2025, indicating a slowdown in industrial profitability [6][8] - High-tech manufacturing continues to support the profitability of industrial enterprises, suggesting a potential area for investment [6][7] - The report notes that while operating income for industrial enterprises grew by 2.7%, the growth rate has narrowed, indicating cost pressures that may affect profitability [6][7] Macroeconomic Overview - The total profit of industrial enterprises reached 27,204.3 billion yuan in the first five months, with a significant drop in May, where profits fell by 9.1% year-on-year [6][7] - The operating income for industrial enterprises showed a slight increase, with a profit margin of 5.0%, which is a marginal improvement from the previous month [6][7] - The report emphasizes the need for demand-side policies to stimulate growth, particularly in the real estate sector, which remains a significant shortfall in domestic demand [7][8] Industry Performance - The report provides a snapshot of various industry performances, with the non-ferrous metals sector showing a positive growth of 2.17%, while the banking sector experienced a decline of 2.95% [5] - The overall industrial production activity remains active, with an industrial added value growth of 6.3% year-on-year, although price pressures persist due to weak demand [7][8] - The report indicates that the prices of key commodities such as crude oil and iron ore have decreased, impacting the profitability of domestic industrial enterprises [8]