China Industrial Profit Growth Accelerated In April, Meituan Earnings Mask Rising Competitive Pressures

Li Chen
27 May, 2025
Hong Kong

Stock market indexes in China and Hong Kong struggled to stay above the flatline, and persistent worries about the domestic economic growth slowdown were compounded by U.S. trade policy uncertainties. 

The Hang Seng index decreased 0.4%, and the mainland-focused CSI 300 index decreased 0.6%, and industrial profits at leading Chinese companies rose at a faster pace in April.

Profits at industrial companies accelerated to 3.0% in April from 2.6% in March, supported by Beijing's continued efforts to support economic expansion and ward off mounting trade risks. 

For the first four months, to April, profit growth accelerated to 1.4% from 0.8% in the same period a year ago.  

E-commerce companies were in focus after Meituan's earnings surpassed market expectations. 

Foreign investors have remained skeptical of Chinese stocks despite the growing valuation discount to U.S. stocks amid worries of sluggish economic growth and lack of earnings visibility. 

 

China Indexes and Stocks 

The Hang Seng index decreased 0.4% to 23,181.95, and the CSI 300 index declined 0.6% to 3,836.88.  

Meituan edged down 0.3% to HK $128.90 despite the e-commerce delivery platform operator reporting better-than-expected results in the March quarter. 

Revenue in the quarter increased 18.1% to 86.6 billion yuan, and net income soared 87.3% to 10.1 billion yuan from a year ago, respectively.

The company's core local businesses, covering food and grocery delivery, merchant services, and travel and hotel bookings, rose 39.1% from a year ago to 13.5 billion yuan. 

Amid rising competition and falling margins, the company has stepped up its operations in the Middle East and announced its plans to invest $1 billion in Brazil. 

The IPO parade continued, and two new companies began trading in Hong Kong. 

Xiamen Jihong soared 50% to HK $11.61, and the e-commerce advertising and marketing service sold about 70% of its initial public offering to foreign investors. 

The advertising service provider sold 67.91 million shares at a price of HK $7.68 in an initial public offering and raised gross proceeds of HK $521.5 million. 

PegBio declined 20% to HK $12.56 after the company priced its public offering at HK $15.60 per share.

The biotech company, which focuses on treating metabolic disorders related to chronic diseases, sold 19.7 million shares and raised gross proceeds of HK$300.8 million.