The rise of industrial profits in March reflects structural improvements in the economy, official data suggested on Thursday.

Major industrial companies registered 23.8 percent year-on-year profit growth last month, down by 7.7 percentage points from the previous two months, according to the National Bureau of Statistics.

In the first quarter of this year, the growth rate of company profits increased 28.3 percent year-on-year, down 3.2 percentage points compared with the first two months.

Although the growth slowed a little compared with the same period last year, double-digit growth is a good sign, according to He Ping, an NBS statistician.

He said high raw material costs have squeezed profits, but expected the positive trend to continue, as some promising signs have appeared in the economic structure.

Profits in March from traditional industries - mainly mining and raw materials - accounted for a smaller share of profits (down 0.9 and 9.5 percentage points, respectively) compared with the previous two months, the data showed.

By comparison, the contribution of consumer manufacturing and equipment manufacturing to total profits increased by 0.5 and 0.6 percentage points respectively during the same period.

In the meantime, profits for private enterprises increased from 14.9 percent to 15 percent in March, while the rate of profit growth for State-owned enterprises dropped to 70.5 percent from 100.2 percent.

"A slight slowdown in growth does not mean the economy has peaked and will recede," said Deng Haiqing, an analyst at Jiuzhou Securities.

"Considering all the recent promising factors, such as relatively high profit growth and the rebound of private fixed asset investment, the economy might have passed the lowest point of the L-shaped recovery path and will bottom out."

Gao Ming, an analyst at China Merchants Securities, attributed the rapid profit growth in the first quarter to four causes: a price surge, a recovery in the future economic outlook, recovery on the demand side and improvements in production efficiency.

Looking ahead, the rate of profit growth may continue to slow a little, considering that one of the main drivers - a surge in prices - might recede in the coming months, according to Gao.

Data from the NBS showed that the price surge accounted for 16.2 percent of the profit growth in March, compared with 22.7 percent in the first two months.

Gao said annual profit growth this year might fall within the 15 to 20 percent level.

Overall, China's GDP expanded 6.9 percent year-on-year in the first quarter of 2017, up from the 6.8 percent growth in the previous quarter and 6.7 percent in 2016.

It also beat previous market expectations of 6.8 percent and came well above the annual growth target of around 6.5 percent.