The Motivation And Financial Effect Of Stock Repurchase Of A-Share Listed Companies

As a way of capital operation,stock repurchase has the functions of improving financial leverage,optimizing shareholding structure,anti-acquisition,replacing stock allocation,and transmitting confidence to investors.It has been developing in the western capital market for more than 60 years.Stock repurchase started slowly in China,with short development time and distinctive Chinese characteristics.Before 2005,the main purpose of China's stock repurchase was to reduce state-owned shares and restructure assets.Due to legal restrictions,it is impossible to circulate A shares in China.Conduct stock repurchase.After the law of 2005 allowed stock repurchases in the open market,China's A-share stock repurchase began to develop.In 2008 and 2015,China's A-share market has experienced stock market crashes,and stock repurchases have increased in the past two years but are not obvious.In 2018,the number of stock repurchases in China's A-share market surged sharply.In order to promote the stable and healthy development of the capital market,the national people made more revisions to the provisions of Article 142 of the Company Law regarding stock repurchase on October 26.The restriction on stock repurchase.Stock repurchases have therefore become a hot topic in 2018.Therefore,studying the motivation of A-share stock repurchase in the current situation has important theoretical and practical significance for the healthy development of the capital market.Firstly,the paper sorts out the relevant literature on stock repurchase,sorts out the theoretical knowledge related to stock repurchase,and then summarizes the changes in China's stock repurchase policy and the stock repurchase type and stock repurchase use in the A-share market.I did a statistical analysis and summarized some problems in the repurchase of A-share stocks from the data.In terms of cases,the paper selected Hangjin Technology,which was a stock repurchase in 2018,as a research object.Based on the full understanding of the basic theory of stock repurchase,the case study method was used to analyze the specific process of Hangjin Technology's stock repurchase.Using the event research method,the market effect of Hangjin Technology's stock repurchase was studied.The descriptive statistical analysis method was used to compare the financial indicators before and after the repurchase to study the impact of stock repurchase on the company's finance.Through case analysis,Summarize the problems in the stock repurchase case.Finally,based on the problems found,put forward corresponding policy recommendations.The study found that during the stock repurchase period of Hangjin Technology,the behavior of major shareholder reductions occurred,and after the shareholding decreased,the stock began to fall,and the company officially began to repurchase shares,which may have hidden incentives for the transfer of shareholders' interests;During the period of cumulative abnormal return rate,it was found that the stock price of Hangjin Technology did not rise due to stock repurchase;by comparing the financial indicators before and after the stock repurchase,it was found that the stock repurchase did not make the company's profitability and solvency Upgrade.In the end,in the stock repurchase of Hangjin Technology,there is a benefit transfer that damages the interests of small and medium shareholders,changes the use of stock repurchase to lower the stock price,and proposes policy revisions to protect minority shareholders and prevent market manipulation.