As of January 25th, data from Tonghuashun iFind shows that a total of 934 A-share companies have released their 2025 performance forecasts. Among them, 506 companies are expected to achieve varying degrees of year-on-year growth in net profit (based on the maximum change range of forecasted net profit), with 16 companies anticipating a growth exceeding 500%.
Overall, actively exploring domestic and international markets, reducing costs and increasing efficiency, and enhancing product added value are the primary reasons for the significant year-on-year net profit growth of these companies. However, the specific drivers for performance growth vary from company to company. Some companies are showing a pronounced year-on-year increase due to a low earnings base in the previous period, which makes the 2025 improvement appear substantial. Other listed companies have demonstrated long-term operational stability, with both the absolute amount of net profit and the year-on-year growth rate showing a steady upward trend. Additionally, some companies have experienced rapid earnings growth driven by significant changes within their core business industries during 2025.
From an industry perspective, a clear recovery is evident in certain sectors, collectively benefiting the relevant listed companies. For instance, companies in the petroleum, chemicals, rubber, and plastics industries (classified by CSRC standards) have generally positive earnings expectations. Among the 78 related companies that have issued performance forecasts, 51 anticipate net profit growth, with 22 forecasting a year-on-year increase of over 100%.
Liu Youhua, Research Director at Shenzhen Qianhai Paipaiwang Fund Sales Co., Ltd., attributed this mainly to an improvement in the supply-demand dynamic. On the supply side, the capacity expansion cycle in related industries has concluded, new capacity additions are constrained, and this is coupled with industry self-discipline in production cuts and the exit of high-cost overseas capacity, leading to supply contraction and pushing product prices higher. On the demand side, domestic policies aimed at stabilizing growth are taking effect, spurring a recovery in downstream demand from sectors like new energy, home appliances, and automobiles, while export markets remain resilient, resulting in simultaneous increases in both sales volume and price. On the cost side, falling prices for raw materials such as crude oil and coal have significantly improved corporate gross margins. Leading enterprises, leveraging their technological and scale advantages, have been the first to see a recovery in profitability.
Huang Liheng, Fund Manager at Shenzhen Qiantu Private Securities Fund Management Co., Ltd., stated that the anticipated earnings growth for many companies in the petroleum, chemicals, rubber, and plastics industries is primarily due to improved profit margins resulting from the continuous rise in prices of related products.
Several listed companies in these related industries mentioned "improved gross margins" and a "favorable industry outlook" in their performance forecasts. On January 22nd, Limin Holdings Group Co., Ltd.'s performance forecast indicated that its net profit attributable to shareholders is expected to increase by 471.55% to 514.55% year-on-year for 2025, driven by higher sales volume and prices of its main products and improved gross margins.
Also on January 22nd, the performance forecast released by Zhejiang Juhua Co., Ltd. showed that it expects its net profit attributable to shareholders to grow by 80% to 101% year-on-year in 2025. The main reasons for this substantial performance increase are the continued restorative price increases for its core product, fluorine refrigerants, along with stable production and sales volumes of its main products, leading to an increase in gross profit and profit from its main business.
Currently, it appears that a virtuous cycle is likely to form within the supply chains of high-growth industries like petroleum, chemicals, rubber, and plastics, with leading listed companies in various sub-sectors potentially benefiting.
"The sustainability of this new upward cycle in related industries is expected to be longer than previous cycles. Particularly for leading enterprises with global deployment capabilities, their market share worldwide is likely to continue expanding, supporting sustained and stable earnings growth," Huang Liheng said.
