Moody's: China's GDP growth will boost companies' earnings
In its latest review report on China, Moody’s Investors Service noted that “China's economic rebound will buoy demand for goods and services, lifting companies' revenue over the next 12-18 months.”
Key takeaways
“Rising demand for goods and services in China, driven by GDP growth, will boost the earnings of most rated companies this year and next.”
“For sectors such as auto and auto services, food and beverages, and technology hardware, EBITDA growth will outpace debt expansion, improving Chinese companies' leverage.”
“On the other hand, high spending needs will stall deleveraging for construction and engineering companies despite buoyant revenue and EBITDA due to a solid order backlog.”
“Greater competition as a result of antitrust regulations will reduce the EBITDA margin of internet and technology companies.”
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Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
