Motivation And Effect Evaluation Of Stock Repurchase In Limited By Share Ltd

Share repurchase refers to the process in which a company repurchases its listed and foreign-traded shares in a specific way and step.Share repurchase plays an active role in equity incentive,optimizing capital structure,adjusting stock price and anti-takeover.Therefore,stock repurchase is used in capital operation and corporate finance in mature foreign capital markets.But in our country,because of the shortcomings of the stock market such as short development time and late start time,there is a certain gap between the application of share repurchase and the developed countries abroad.So far,the target of stock repurchase in China has shifted to public shares,not the original state-owned shares and non-tradable shares.China's control over stock repurchase is slowly relaxing,coupled with the continuous development of capital market,stock repurchase will become more and more popular,and will enter a new era.Most domestic scholars are deeply interested in the impact of stock repurchase on listed companies.In order to obtain the theoretical hypothesis or test the theoretical hypothesis,empirical research on the effect of stock repurchase motivation is seldom carried out.Therefore,this paper will study the motivation and financial effect of the repurchase of Zhongbao in Xinhu,and enrich the case study of repurchase from the perspective of the impact of stock repurchase motivation.In 2015,the stock market experienced a dramatic change from soaring to plunging.In this market situation,in order to maintain its capital market situation,Xinhu Zhongbao actively launched investor relationship governance.Therefore,in order to maintain the stability of the stock price and the rights and interests of investors,Xinhu Zhongbao has formulated the plan of employee stock ownership and stock repurchase,which makes managers' firm confidence in the development of the company transmitted in the market.From the relevant financial data,investors' confidence has been consolidated and the market share price has been raised after the repurchase of Zhongbao in Xinhu.In addition,from the perspective of financial indicators,repurchase has brought about the optimization of capital structure,whether long-term,short-term solvency indicators or related profitability indicators have improved.It can be seen that the stock repurchase of Zhongbao in Xinhu has a positive effect on the financial effect.The findings of this study enrich the relationship between the repurchase motivation and its financial effect,and the timing of the repurchase of Zhongbao in Xinhu deserves to be used for reference.This paper will divide the research into five parts about the financial effect before and after the implementation of the stock repurchase in Xinhu Zhongbao.The first part is a brief review of the relevant research theories of stock repurchase at home and abroad,narrating the impact of stock repurchase on the financial effect of enterprises,and putting forward the appropriate research methods and ideas.The second part summarizes the hypothesis and motivation of stock repurchase,and analyses the current situation of stock repurchase in China.The third part takes Xinhu Zhongbao as an example to discuss the motivation of buying back.First,it starts with the general situation of Xinhu Zhongbao,then it briefly describes the process of buying back,and then carries on the reason analysis of Xinhu Zhongbao's buying back motivation.The fourth part evaluates the effect of motivation based on the effect of the implementation of share repurchase on financial effect.Starting from the comparison between the pre-and post-repurchase of Zhongbao in Xinhu and the industry average or other enterprises in the same industry,the paper analyses the changes of stock price from the perspective of market,P/E ratio and P/E ratio,and studies the impact of share repurchase on debt repayment effect from the perspective of short-term debt repayment index and long-term debt repayment index.Profit index is used to study the effect of share repurchase on profit.The fifth part summarizes the relevant conclusions and suggestions based on the study of Zhongbao in Xinhu Lake,and then summarizes the weaknesses of this study,and expresses the desire to carry out more in-depth research in the future.The ultimate problem to be solved in this paper is how to avoid the negative financial effects that enterprises will encounter after share repurchase,so as to make the repurchase effect develop towards the expected goal.Moreover,when enterprises begin to buy back,they should grasp the timing,implement the necessary control in the process of repurchase,and adjust the problems after the completion of repurchase.In addition,we should ensure adequate repurchase funds and appropriate forms of investment,and further analyze the impact of share repurchase on the financial performance,cash flow and capital structure of enterprises.At the same time,we need to pay attention to the particularity of different industries.The stock repurchase of Xinhu Zhongbao provides a reference for the summary of the specific content of repurchase,and also provides some reference for the matters needing attention in the process of repurchase.