How to View the Performance of A-Shares in the 2025 Mid-Year Report | Chongyang Q&A

Q: How does Chongyang Investment view the performance of the A-share mid-term report for 2025?

A: As of August 31, the mid-year reports for A-share listed companies have been fully disclosed, showing a performance characteristic of "overall still bottoming out, significant structural differentiation" in the first half of the year.From the perspective of overall performance, the profitability of listed companies is still bottoming out.According to statistics from GF Securities, the year-on-year revenue growth rates for A-shares overall and non-financial enterprises in the first half of the year were -0.02% and -0.53%, respectively, showing some improvement compared to the first quarter. However, the cumulative year-on-year growth rates for net profit were 2.42% and 0.98%, respectively, which declined compared to the first quarter. From a quarterly perspective, the sequential growth rate for non-financial enterprises in the second quarter hit a seasonal low since 2010, with the net profit growth primarily contributed by financial enterprises. From the perspective of Return on Equity (ROE), the ROE (TTM) for A-shares overall and non-financial enterprises in the second quarter were 7.76% and 6.55%, also declining compared to the first quarter. A DuPont analysis indicates that while the net profit margin stabilized somewhat, the asset turnover ratio continued to decline, reflecting that the recovery of economic supply and demand requires more time. From a cash flow perspective, although the mid-year report for 2025 shows that corporate net cash flow has not yet turned positive, operating, investing, and financing cash flows have all improved. The free cash flow for non-financial real estate companies remains historically elevated, indicating a strong potential for dividends. Overall, the profitability of A-share listed companies is still in the process of bottoming out, and improvements in profitability will still depend on the revival of demand.From a structural perspective, high-tech companies and those engaged in overseas operations have performed well, while domestic consumption remains to recover.In terms of profit growth rates, the net profit growth rate for the Sci-Tech Innovation Board exceeded 20% in the second quarter this year, leading the entire market, with significant year-on-year profit growth in the high-tech sectors represented by the artificial intelligence industry chain, semiconductors, and innovative pharmaceuticals. From the demand perspective, the profitability of export-oriented enterprises has shown a clear advantage over domestically-oriented enterprises. For instance, the overseas 50 index experienced a year-on-year revenue growth rate of 12%, with ROE significantly rising by 0.6%, clearly outperforming the broader market. More broadly, according to statistics from CITIC Securities, listed companies with more than a 10% increase in the proportion of overseas business income over the past year are witnessing a gradual recovery in profit margins and ROE levels. Overseas operations are gradually becoming a core pillar of financial growth for some enterprises. Stocks exceeding market expectations have been concentrated in innovative and export-oriented companies in electronics, machinery, and healthcare. In contrast, companies in domestic demand sectors, such as durable consumer goods, have seen a noticeable decline in growth rates in the second quarter compared to the first quarter, reflecting the ongoing need for recovery in domestic consumption. For industries facing concerns about involution, we still need to wait for capacity utilization rates to hit bottom. Overall, the profits of A-share listed companies are gradually solidifying at the bottom, with innovation and overseas operations becoming new growth points for profitability. Looking ahead, with the introduction of more favorable growth-stabilizing policies and the gradual stabilization of the economic fundamentals, A-share listing profits are expected to continue to rebound.

▲ Swipe up to read.[Disclaimer]

This material is original and edited by Shanghai Chongyang Investment Management Co., Ltd. (hereinafter referred to as "Chongyang Investment") and is intended solely for informational and investor education purposes. The information and materials on which this material is based come from publicly available channels (e.g., Wind, Bloomberg) and internal research results, which are considered reliable; however, Chongyang Investment makes no explicit or implied representation or warranty regarding their completeness or accuracy. The related information is for reference only and does not constitute an advertisement, sales offer, or investment advice for any securities, funds, or investment products. Any entities, brands, products, etc. referenced in this material are used solely as subjects for research and analysis, and do not represent the actual operations of Chongyang Investment. Due to various factors such as restrictions on fund product investments, portfolio adjustments, and trading costs, the actual operations of Chongyang Investment may differ from the conclusions drawn in this material.

This material does not take into account any specific investment needs, investment objectives, or risk tolerance of the reader. Before investing, readers should carefully read the product's legal documents and risk disclosure statements, fully understand the risk-return characteristics and features of the product, and consider their own risk tolerance, making rational judgments and cautious investment decisions.

The copyright of this material belongs to Chongyang Investment. Without authorization from Chongyang Investment, no institution or individual may forward, reproduce, duplicate, publish, modify, imitate, or cite the contents of this material in any form.

If you are interested in Chongyang products, feel free to inquire.

The public account has changed the push notification rules.

Our articles may get lost in the vast information flow.

A part of you,Share, Like, 'Looking'，

can bring us a step closer,

for a better encounter,

star mark pinnedis also excellent.

Chongyang Investment is always with you.

913 Views