Research On The Motivation And Effect Of Stock Repurchase In Midea

Under the rapid development of China's economy,China's capital market is developing rapidly,and stock repurchase gradually becomes a way of capital operation and business operation in capital market.Stock repurchase operation as a tool of the mature capital market,the effect of various forms,the most direct is to reduce equity,improve the ownership structure of enterprises,in addition to repurchase can stimulate the stock price rise,increase the company's overall value,to prevent the hostile takeover also has a certain role in the company's dividend and stock repurchase,due to the role of the rich diversity,so it is very necessary to study the stock repurchase,to allow companies and investors about the stock repurchase more stock repurchase,better use.Compared with the western developed countries,China's economic development is relatively slow,resulting in the formation of China's securities market is also relatively late,stock repurchase in the stock market is more late,and the development process is relatively short.Due to the influence of national policies and regulations,the early stock repurchase is very difficult,and few enterprises carry out repurchase.In 2005 the Commission issued the "public listed companies to repurchase shares management approach(Trial)" the implementation of China's Listed Companies in the stock repurchase gradually increased 2008,since the outbreak of the economic crisis,the stock market suffered heavy losses,the stock repurchase price stability,transfer of enterprise value is underestimated to the outside world,many companies began to use stock repurchase to stimulate the stock market down when the company's share price,but also can protect the interests of shareholders.Then it is of great significance for the listed companies to study the repo motivation and repurchase effect of stock repurchase.This paper uses case study method,using literature research method,event study method and financial comparative analysis method to explore the motivation and effect of Midea Company stock repurchase.In the survey of relevant literature and theory,the Midea Company stock repurchase case separately in-depth analysis,the key motivation in the Midea Company stock repurchase and the stock repurchase of company produce financial effect and market efficiency are discussed,the motive and effect of calibration and data unearthed from corporate repurchase the related finance.On the Midea Group of the whole stock analysis,found the main drivers of Midea Group stock repurchase is compared with the same industry stock price has been seriously underestimated,the enterprises need to pass a positive message to the outside world,there is a reason that companies use stock repurchase for dividend,up to the high tax section of the shareholders can use stock repurchase to reasonable the increase of their income tax.Through the analysis of the effect,the stock repurchase of the U.S.group conveys a positive excess accumulative rate of return,and the value of the enterprise is improved.At the same time,stock repurchase also brings positive financial effects to enterprises,and financial indicators related to stock repurchase related debt paying ability,profitability and growth ability have been improved.