Aided by a policy boost, China's economy is showing more signs of improvement, as official data on Wednesday revealed that profits at China's industrial firms grew for the fourth consecutive month in November.

Analysts said a run of recent data points to a stabilizing in the world's second-largest economy, which is set to expand by above 5 percent this year and is well positioned to achieve its 2023 annual growth target.

Looking to the future, despite the likelihood of the property slump continuing to be a drag on the economy, analysts said that China's economy is likely to perform better in 2024 with a gradual recovery in domestic demand and consumption and an improvement in external financial conditions.

On Wednesday, data from the National Bureau of Statistics showed that industrial enterprises with annual revenue of at least 20 million yuan ($2.8 million) saw their total profits increase 29.5 percent year-on-year in November after a 2.7 percent rise in October.

For the January-November period, industrial firms' profits fell 4.4 percent year-on-year to 6.98 trillion yuan, narrowing from the 7.8 percent drop in the first 10 months, the bureau said.

"The latest figures reflect a continued recovery in domestic industrial sector operations and market demand," said Zhou Maohua, a macro researcher at China Everbright Bank.

Among the 41 major industrial sectors surveyed, 33 witnessed improvements such as accelerated growth, narrowed profit declines and year-on-year growth in profits during the first 11 months, NBS data showed.

Zheng Houcheng, chief macroeconomist at Yingda Securities, said the improvement comes amid a surge in industrial output, improved profitability and a lower comparison base in the previous year, but the negative growth in producer prices drags on profit growth.

China's value-added industrial output grew 6.6 percent year-on-year in November after a 4.6 percent rise in October, while China's producer price index dropped 3 percent from a year ago in November versus a 2.6 percent fall in October, NBS data showed.

Zheng said the industrial profits will likely improve further in December, but there is little chance of seeing industrial profits returning to growth for the whole of 2023.

Despite the improvement in the overall industrial sector, Zhou from China Everbright Bank said the recovery was uneven among different sectors.

High-tech and equipment manufacturing sectors recorded rapid growth while textiles, ferrous metals mining and property-related industries reported shrinking profits, he said.

Zhou called for expansionary macro policies to consolidate the recovery trend, estimating that the economy may expand by around 5 percent next year given the gradual recovery in domestic demand and easier external financial conditions.

A new report released by the Bank of China Research Institute said that China's economy will likely expand by around 5.6 percent in the fourth quarter with an anticipated annual growth rate of 5.3 percent in 2023, higher than the preset annual growth target of around 5 percent.

Considering the continued recovery in domestic demand and improvement in the external environment, the institute expected to see further recovery in consumption, accelerated growth in infrastructure, manufacturing investment and a narrowing decline in property investment. And China's economy is set to reach around 5 percent in 2024.

Zhang Aoping, the dean of the Incremental Research Institute, said China should consider a proactive annual growth target of around 5 percent next year, adding that fiscal expansion will be crucial to achieve the target in 2024.

He said China could raise its 2024 budget deficit ratio to around 3.5 percent to spur growth, expecting the government to set its 2024 quota of 3.8 trillion yuan to 4 trillion yuan in local government special bonds.

He noted that more efforts should also be made to support manufacturing development, such as offering more subsidies for enterprises' digital technology upgrades and low-carbon and green technology upgrades.

When it comes to next year's monetary policy, he said the country will likely offer structural support for areas such as technological innovation, green transition, small and micro businesses, and the digital economy.