Baosteel Repuechase Case Of Small Investors Perspective

Baosteel Group Corporation, China’s largest steel company, Baosteel is its own subsidiary, Shanghai Stock Exchange. Baosteel Group in August2012announced a＄5.0billion share repurchase ceiling plan, caused widespread concern in the capital market participants.2012domestic capital market, share repurchases as springing from the non-poor, and foreign shares, UF software technology have thrown Hingsen buyback program to join the ranks. The share buyback is still new things, so that not much had this concept into medium and small investments are confused.So I consider the lack of relevant experience in the market, the premise, it is necessary to proceed from the interests of small investors point, meaning its share repurchase elaborate and analyze the underlying causes of the phenomenon under the share repurchase, and provide appropriate risk comment.This article focuses on what is the share repurchase, what and why. The author believes that the repurchase of Baosteel event, not simply financial behavior, but rather the product of the dual role of industry and capital markets environment under; Meanwhile, the author explores the meaning of share repurchases, and the current industry in our country, the law potential problems that may exist in the context of, and recognition of its moral hazard.This article aims to provide the necessary information and tips for the small investors in the capital market under asymmetric information, the text is divided into five parts, the first part is an introduction to the concept of share repurchases, set out a number of existing academia hypothesis, while the share repurchase briefly discussed the legal situation and the potential for moral hazard in China. The second part is the author of Baosteel’s steel industry, which industry analysts and industry come to the overall market downturn led to its share repurchase to take action due to the external one. The third part is the author of the operational status of Baosteel Group, is divided into macro and micro perspectives, and come within their operational status is its share repurchase actions motivation. The fourth part is the description and analysis of Baosteel repo operations to track the progress of its buyback studied the effect its repurchase generated, and further in-depth understanding of the reasons for its repurchase. The fifth part is the author of the overall interpretation of the repurchase behavior, and concluded that the risk of market participants in particular, tips, and experience suggests that small investors.