China's major industrial firms reported a 4.2 percent increase in their profits in the month of April, down from the 11.1 percent increase reported in March.

The firms also reported a decline of 1.2 percent year-on-year in product inventories. This is the first decline in China's industrial product inventories in recent years.

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According to the National Bureau of Statistics, profits at industrial companies with annual revenue of more than 20 million yuan ($3.1 million) amounted to 502 billion yuan in April. The total profits for the first four months of the year stood at 1.84 trillion yuan, up by 6.5 percent year-over-year. However, the rate is lower than 7.4 percent increase recorded for the first quarter of the year in 2015.

The latest data has cast a shadow of doubt on China's economic resurgence.

China is also facing uneven growth across the sectors. Its steel mills recorded a 42 percent gain on the back of a rebound in pricing and increased production. Meanwhile, the country's oil refinery sector posted an 80 fold increase in the first quarter. However, China's coal sector saw a 92.2 percent decline in its profits. The oil and gas sector showed an overall drop with industrial companies posting a 4.8 percent increase in debt on an annual basis to reach 55.8 trillion yuan at the end of April.

The worries about China's economy persist as a survey conducted by the Cheung Kong Graduate School of Business showed excess capacity levels to be at a record high. The survey also noted that the industrial economy remained unstable during the first quarter of the year. Another report showed an 8.4 percent decline in the profitability of state-owned firms between January and April.

TagsEconomy, people's bank of china