Research On The Motivation And Market Effect Of Share Repurchase In Home Appliance Industry

High-quality development is the primary task of comprehensively building a socialist modern country,and the securities market,as an important part of China’s high-quality development,plays an important role in promoting economic development,optimizing resource allocation and improving corporate governance.Share repurchase,as a common tool in the securities market,has shown a rapid growth trend in recent years,and in 2018,China introduced a new regulation on share repurchase,which aims to support and guide listed companies to conduct value repurchases and promote the benign development of share repurchase in China.At the same time,the overall completion rate of share repurchases for the purpose of market value management is low,which deviates from the original intention of value repurchases and affects the normative development of the securities market,and has become a problem that needs to be solved in the development process of share repurchases in China.This paper applies financial effect theory,principal-agent theory and signaling theory to study the motivation and market effect of share repurchases by listed companies in the home appliance industry in China through a combination of quantitative analysis and case studies.To this end,this paper compares the current situation of share repurchases of listed companies in the home appliance industry in terms of the scale,purpose,actual completion and characteristics of the repurchases,and concludes that the overall completion rate of share repurchases for the purpose of market value management in the home appliance industry is low;then,for the share repurchases for the purpose of market value management in listed companies in the home appliance industry,we identify the completion rate of share repurchases from both the financial situation and action events.In order to judge and analyze the sincerity and authenticity of the listed companies’ repurchase motives,and to analyze the market effects of the listed companies’ announcement of repurchase plans and termination of repurchase by the event research method,so as to determine whether small and medium-sized investors in China can effectively identify the share repurchases with low completion rates;Finally,Company D is used as a case study to analyze in depth the motivation and market effect of share repurchase for the purpose of market value management.The research found that:(1)The stock buyback rate of household appliance listed companies for the purpose of market value management is low;(2)Home appliance listed companies with low completion rate of share buyback perform poorly overall;(3)Most appliance companies with low completion of share buyback have hidden motives;(4)Small and medium investors cannot effectively identify share repurchases with low completion rates.On the basis of the above findings,some recommendations for action by businesses are put forward,how to identify the true or false repurchase and how to supervise the small and medium-sized investors in China: the internal corporate governance should be improved and the repurchase plan should be carefully designed.At the level of small and medium-sized investors,the knowledge of share buyback should be improved,and the ability to judge truth and falsehood should be improved.External supervision should be aimed at improving the legal regulation and strengthening the regulatory role.