During the year, 329 listed companies issued 346 repurchase plans-

　　Why is the share repurchase boom surging?

　　Our reporter Li Hualin

　　As a basic institutional arrangement of the capital market, share repurchase has always been regarded as an effective means to help listed companies and investors to interact positively, and can convey multiple information such as stable performance, abundant cash flow, and good development to investors.

　　Since the beginning of this year, the enthusiasm for repurchases of listed companies has been high, some are used for equity incentives, some are designed to boost stock prices, and some are used to reward ordinary investors.

However, at the same time, phenomena such as "show-style", "flicker-style" repurchase and "repurchase while reducing holdings" still exist.

Experts remind that investors should not blindly use repurchase as an investment standard, and should rationally treat the repurchase behavior of listed companies.

　　Bright development confidence

　　Statistics from market institutions show that since the beginning of this year, the popularity of repurchase by listed companies has increased.

According to Fong Shun iFinD data, as of October 14, a total of 329 listed companies issued 346 repurchase plans during the year, a year-on-year increase of more than 90%; from the perspective of progress, 137 orders have been implemented, with a completed amount of more than 46 billion yuan.

　　Many companies have announced that they will use repurchase to implement equity incentives or employee stock ownership plans.

For example, Qingdao City Media Co., Ltd. recently announced that it will repurchase the company’s shares through a centralized bidding transaction with a maximum repurchase amount of 400 million yuan for the implementation of equity incentive plans. Shanghai Daming City Enterprise Co., Ltd. recently issued an announcement. , The shares to be repurchased for use in employee stock ownership plans or equity incentive plans, with the repurchase amount not less than 100 million yuan and not more than 200 million yuan.

　　"Repurchasing stocks is a manifestation of a company's affirmation of its own value and bright development confidence. Companies may use repurchase to provide equity incentives to boost employee enthusiasm, tie employee benefits with corporate benefits, and tap new potentials for the company; or cancel through repurchase , To achieve dividends to drive the enthusiasm of investors.” said Pan Helin, executive dean of the Institute of Digital Economy, Zhongnan University of Economics and Law.

　　"Rescue" the falling stock price is another main reason for listed companies to repurchase.

For example, Shanying International Holding Co., Ltd. issued an announcement in August stating that the closing price of Shanying International’s stock was lower than the net assets per share in the most recent period. The current stock price no longer correctly reflects the company’s value. In order to maintain business development and stock price stability, and to protect investors For the long-term interests of the company, it intends to use its own funds to repurchase the company’s shares in a centralized bidding transaction.

　　Tian Lihui, Dean of the Institute of Financial Development of Nankai University, believes that when the company’s individual stock prices are sluggish and some stock prices are even lower than their fair value, the repurchase of stocks is a positive signal to the market for the company, indicating that the company is optimistic about its own development prospects, so as to improve Investors' confidence in the company has allowed the company's investment value to return reasonably.

　　In addition, the reporter found that while the number of listed companies implementing the repurchase plan has increased, the repurchase scale has also been increasing. Many companies have repurchased more than 10 billion yuan, mainly concentrated in household appliances, computers, medical biology, etc. industry.

For example, Gree Electric has completed the third phase of the repurchase program launched this year, with a total transaction amount of 15 billion yuan; as of August, Midea Group has completed two rounds of repurchase plans this year, with a total payment of more than 13 billion yuan.

"Most of these companies are at a relatively mature stage of development, with relatively abundant cash flow, which can ensure the sustainability of their operations. Good performance, more cash flow combined with reasonable valuations have created a higher amount of repurchase programs." Pan Helin said in analysis.

　　Strictly prevent "flickering" repurchase

　　The implementation of repurchase by listed companies can show confidence in their own development, and can also give back to investors and increase trading activity. It can be said to serve multiple purposes.

However, judging from past cases, there are also many listed companies that use repurchase as a means to offset the company’s negative news, and bad news broke in the company. At that time, the "emergency" repurchase program was launched quickly.

　　Experts believe that it is understandable for listed companies to use repurchase as an emergency measure to stabilize their stock prices, but they must comply with legal procedures and information disclosure requirements.

"Repurchase is not a panacea. If the company's internal quality is poor and profit growth is insufficient, the stock price will not be stable for a long time. And once the company's internal news owner leaves the market first, the wealth of ordinary investors will be damaged. In the end, it will trigger investors to vote with their feet.” Tian Lihui said that, compared to launching a repurchase plan, the company should work harder to improve operations and improve quality to fundamentally eliminate investors’ doubts.

　　There are also some listed companies repurchasing "the thunder is loud and the rain is small", and the actual repurchase amount is quite different from the plan, and there is a suspicion of "show-like" and "flicker-like" repurchase.

"For example, when a company said at a stock price of 60 yuan that it would repurchase at a price not higher than 100 yuan, the price gap between the two is too large, which obviously has the nature of fooling investors." said Yin Zhongli, a researcher at the Institute of Finance, Chinese Academy of Social Sciences. .

　　"Share repurchase should be a company's market behavior based on believing in its own development prospects, and should not be a means for the company's controller to manage market value." Tian Lihui said, but some listed companies use repurchase for market value management through non-professional media. Or the black mouth of the stock market, deliberately sending false positive signals to the market, triggering market herd behavior.

　　In order to prevent the occurrence of "flicker-style" repurchase and other behaviors, in recent years, the regulatory authorities have taken multiple measures to continuously improve regulatory measures.

In January 2019, the Shanghai and Shenzhen Stock Exchange issued and implemented the "Implementation Rules for the Repurchase of Shares by Listed Companies", which clarified the practice of share repurchase and strengthened rigid constraints on information disclosure; the new Securities Law implemented last year has greatly improved information disclosure. The intensity of administrative penalties for violations of laws and regulations.

In recent years, regulators have increased their supervision of related behaviors. If listed companies engage in "explosive" and "show-like" repurchases, suspected of procedural violations and manipulation of stock prices, they will not only lose the trust of investors, but may also face regulatory sanctions. .

　　It is not advisable to follow suit

　　Although the share repurchase has many benefits, it is not applicable to all listed companies. Whether the repurchase is implemented or not, the listed company has to do what it can.

"Mature listed companies have sufficient liquidity and lack better investment goals. At this time, repurchase is reasonable and can prevent idle funds. Companies that grow up and start-up are in urgent need of a large amount of circulating funds for research and development and expansion of production capacity. At this time, repurchase is not suitable for the long-term development of the enterprise, nor is it the best way to solve the underestimation of value.” Pan Helin said.

　　At the same time, repurchase often has certain requirements for the cash flow of listed companies. If the strength of the listed company is not allowed, the failure to fully fulfill its commitments for various reasons will not only trigger a crisis of investor trust, but also may be subject to regulatory “special attention”. Bring a negative impact on the company's development.

Since the beginning of this year, many companies have received regulatory letters for failing to complete the original repurchase plan.

For example, in February of this year, a listed company due to the expiration of the repurchase period, the actual amount of the repurchase completed only accounted for 15% of the lower limit of the repurchase plan. The regulatory authority issued a warning letter and was recorded in the integrity file.

　　Faced with the repurchase boom of listed companies, investors are more concerned about whether this is a good time to enter the market?

Experts believe that the repurchase of listed companies is not an inevitable signal of rising stock prices. Investors should calmly analyze the pros and cons of company repurchase and make rational judgments.

　　"Starting from the actual operating conditions of the target company, we should study the development stage of the company to see whether dividends are suitable for the development of the company. If the stock price of a mature company is low, repurchase is conducive to the long-term development of the company; Cash flow support.” Pan Helin said.

　　Yin Zhongli believes that investors should also be wary of listed companies taking out real money to buy back while major shareholders are secretly reducing their holdings. This behavior is suspected of violations.

For example, in August this year, a company announced that it was planning to repurchase the company’s shares with a total capital of no more than 120 million yuan. Only a few days later, the company issued another shareholding reduction announcement that its major shareholder planned to reduce the company’s shares. Investors can't help but question that the company's repurchase is to raise the stock price so that shareholders can clear it out?

　　"In order to better protect the rights and interests of investors and prevent the occurrence of such phenomena, in the future, the regulatory authorities will need to further improve the repurchase standards, strict compliance requirements, and increase the "flicker-style" repurchase, repurchase while reducing holdings, and insider information. The penalties for transactions, etc., urge listed companies to abide by laws and regulations, and promote the healthy development of the capital market." Tian Lihui said.