Research On Financial Effect Of Jiahua Energy Stock Repurchase

In recent years,China’s capital market has continued to slump,and the company’s stock price has shown a downward trend,which is not conducive to the company’s long-term stable development.By learning from the experience of foreign capital market development,more and more listed companies realize that stock repurchase as a financial tool,if used properly,will play a decisive role in the company.By the end of 2019,702 listed companies had issued stock repurchase plans,of which 491 completed stock implementation activities,accounting for more than half of the companies that issued the plans.The positive effect of the listed company’s stock repurchase is great.On the one hand,the company’s shareholding structure has changed,and on the other hand,the effect of signal transmission has been achieved through stock repurchases,which has better promoted the healthy and stable development of China’s capital market.But at the same time,because China’s laws on stock repurchase are not perfect,the company’s formation of insider trading through repurchase,which in turn damages the interests of small and medium shareholders,can not be ignored..This article adopts the method of case study,selects Zhejiang Jiahua Energy Chemical Co.,Ltd.as the research object,researches the stock repurchase implemented by the company from January 2019 to July 2019,and gives a series of opinions based on the changes in financial data before and after the stock repurchase At the same time,it also puts forward reasonable suggestions for companies that intend to carry out stock repurchase.The thesis first introduces the research background of stock repurchase,draws out the practical significance of stock repurchase,using literature research method and case analysis method for analysis,Then introduce the relevant concepts and theoretical basis of stock repurchases.In the case analysis,we first introduce the general situation of Jiahua Energy,analyze the real motivation of its repurchase in conjunction with the company’s repurchase process,stock repurchases increase the company’s profitability,optimize the company’s capital structure and increase the value of the company’s economy at the same time;but at the same time,stock repurchases increase the company’s payment risk and reduce the use of financial leverage coefficient.But on the whole,the positive financial effect brought by this repurchase is greater than the negative financial effect.Finally,through the case study of Jiahua Energy’s stock repurchase,it puts forward suggestions to improve the repurchase qualification control and information disclosure mechanism,with a view to providing suggestions for the improvement of listed companies that intend to carry out stockrepurchase.The practical significance of this article is to analyze the problems of listed companies that implement stock repurchase in China’s capital market,so that investors and listed companies can fully understand the stock repurchase process,and then better use the tool of stock repurchase for The implementation of stock repurchase provides practical suggestions to avoid the financial risks brought by stock repurchase,which is conducive to the healthy and stable development of China’s capital market.