Research On The Motivation And Effect Of Stock Repurchase Of Listed Companies In My Country

Stock repurchase refers to the act of a company limited by shares listed on a stock exchange using the company itself and not needing to repay the funds or using the method of borrowing to purchase the company's shares in the secondary market.Stock repurchase originated in the developed capitalist countries of the West and was regarded as an important tool for the company's capital operation.Different from the developed capitalist countries in the West,China's securities market started late and the stock repurchase development was late.There have been many problems in the early stages of the development of stock repurchases.In the face of problems such as “one big share” of state-owned shares,scarce financing channels,and lack of self-owned funds,stock repurchases are generally used as a means of share-trading reform.In 1992,although Dayuyuan acquired all the shares of Xiaoyuyuan by the government,the repurchase opened the curtain for stock repurchase.With the deepening of reform and opening up,China's securities market is becoming more and more mature,and the way of stock repurchase is also enriched.The persistent stock market turmoil that erupted after June2015 has had many adverse effects on China's social stability and economic operations.In the same year,China's home appliance industry suffered from the market's cold winter.Many home appliance companies carried out stock repurchase,hoping to promote stock price rise and stabilize market expectations.Among them,TCL Group,which is a giant in the home appliance manufacturing industry,has also implemented the capital operation of stock repurchase.In this paper,the case study method,the literature analysis method and the event research method are used to explore the effects of the stock repurchase of 700 million yuan of self-owned funds during the period of stock market volatility and macroeconomic downturn.After combing the relevant literature and theory,the case of TCL Group's stock repurchase is analyzed separately,focusing on the effect of TCL Group's stock repurchase announcement and the effect of repurchase implementation on the shares of TCL Group.Repurchase for detailed effect analysis.The effect analysis at the time of announcement is to study the market effects of TCL Group and Midea Group.The effect analysis during the repurchase implementation is conducted in DuPont analysis and analysis of debt repayment,profitability,operations and development capabilities.In the overall analysis of TCL Group's stocks,it was found that the main reason for the repurchase of TCL Group's stocks was that the stock price was seriously undervalued compared with the same industry,and it was necessary to transmit the favorable signals tothe outside world.Another repurchase motivation was to adjust the financial leverage and improve.The capital structure of the company.Making full use of the company's excess spare funds,reasonable tax avoidance and increasing the concentration of equity in this stock repurchase performance is not obvious,it is difficult to explain the reasons for the company to carry out stock repurchase.Through the analysis of the market effect of TCL Group and Midea Group,it is found that the stock repurchase of TCL Group will deliver a positive excess cumulative return rate in a short period of time,and the value of the enterprise will be improved.At the same time,after the stock repurchase,the company's profitability and solvency have been improved to a certain extent;while development capacity and operational capacity have not changed much.Based on the comprehensive understanding of the equity situation,operation status and overall financial status of TCL Group,the relevant financial indicators and the relevant annual reports of TCL Group are selected for comparison and calculation,and the problems arising during the repurchase period of TCL Group's shares are analyzed one by one.It is found that in the process of TCL Group's stock repurchase,there is a problem that the long-term effect of raising the stock price is not obvious,the excessive consumption of funds,the increase of financial risks,and the adjustment of the share capital structure are not prominent.According to the problems generated,suggestions were made to formulate a reasonable repurchase plan,limit the use of repurchase funds,fully consider the interests of creditors,and regulate the information disclosure system of stock repurchases.