China's listed innovation-driven enterprises reported solid revenue and profit increases for 2022 along with intensified R&D spending, demonstrating their potential in driving economic growth in the country's new development stage.

Market data show that the revenue and net profit growth of such enterprises outpaced overall expansion. Firms listed on the sci-tech innovation board of the Shanghai Stock Exchange last year saw their net profits rise by 6 percent year-on-year to total 113.59 billion yuan ($16.35 billion), according to the Shanghai bourse.

The Shenzhen Stock Exchange said companies on its Nasdaq-style ChiNext board raked in 241.76 billion yuan in net profits, up 11 percent over a year earlier. The 191 firms on the Beijing Stock Exchange, predominantly small and medium-sized enterprises, profited 12.17 percent more than that in 2021.

Analysts say innovation is the engine behind the stellar performance of these companies, whose R&D spending also rose at a faster pace than the aggregate of the 5,079 listed companies in China last year.

R&D spending of companies on the sci-tech innovation board stands at 16 percent of their revenue on average, up 3 percentage points from a year ago, according to the Shanghai bourse. The Beijing Stock Exchange said its companies boosted their R&D staff by 13.34 percent.

"Continued R&D investment helped expand business for listed firms, with green and digital transformation making marked contributions," said Zhang Ping, a researcher with the Chinese Academy of Social Sciences, adding that ramping up R&D also boosted earnings and pricing power.

On top of R&D commitments, refinancing and incentive stock options are also at the disposal of innovative firms to retain key resources for long-term growth, according to analysts.

The further expansion of innovative firms aligns with China's economic priorities in the new development stage, largely due to their increasingly important role in driving the economy.

A meeting of the Political Bureau of the Communist Party of China Central Committee in late April stressed the need to consolidate the foundation of self-reliance and strength in science and technology, while a meeting of the Central Commission for Financial and Economic Affairs on May 5 urged institutional arrangements to ensure the principal position of enterprises in sci-tech innovation.

Chinese companies have witnessed the effects of sci-tech innovation on industrial development. In 2022, 889 high-tech public companies posted a 9.4-percent year-on-year uptick in value-added output, higher than the 4.9 percent average of all listed firms, market data showed.

Innovation-driven firms can also help with China's reiterated pledge to build a modern industrial system underpinned by the real economy. To that end, the meeting on May 5 called for a series of efforts, including seizing opportunities presented by the new scientific and technological revolution, promoting the efficient aggregation of global innovation factors, and boosting the intelligent, green and integrated development of industries.

According to the Beijing Stock Exchange, around 80 percent of the funds its companies raised in 2022 went to cutting-edge fields like the green and low-carbon sector, digital economy, high-end equipment manufacturing and new materials.

"Sci-tech innovation and emerging industries, backed by the continued influx of R&D funds, have made industry chains more independent and spurred the high-quality development of the real economy," said Sun Jinju, an analyst with Kaiyuan Securities.