Research On The Motivation And Effect Of BOE Share Repurchase

As a tool for the capital operation of listed companies,share repurchase is of great significance to stabilizing the company’s stock price,stabilizing the market value and improving the capital structure.In 2018,China revised the Company Law,and after the revision,the share repurchase procedures of listed companies were simplified,the upper limit of the scale of share repurchase was further increased,and the time for enterprises to use the repurchased shares as Treasury shares was also extended.The revision of the Company Law and the proposal of various policy opinions have promoted enterprises to use the share buyback as a market value management tool more flexibly,and also set off a new round of "buyback tide" in China’s capital market.This paper takes BOE A as the case study object,and based on combing the background and related concepts of share repurchase,focuses on the motivation and effect of BOE A’s three A-share repurchases.First of all,this paper briefly introduces the research background and significance of share repurchase and the research results of scholars at home and abroad,and expounds the concept of share repurchase and the representative theory based on the financial effect hypothesis,which lays a theoretical foundation for the following analysis.Secondly,combined with the internal and external environment of the enterprise,the real motivation of BOE A’s share repurchase is analyzed.Thirdly,factor analysis is used to explore the financial effects brought by repurchase.Finally,according to the analysis process,the conclusions are drawn and relevant suggestions are put forward.Through comparative analysis: first,selecting large share repurchase with its own funds will bring cash payment pressure to the enterprise;second,in the short term,share repurchase can boost the stock price,but the business performance and development prospect are the fundamental to determine the long-term trend of the stock price;third,in the execution of share repurchase task,relevant information is leaked in advance.This paper intends to enhance the further understanding and understanding of share repurchase through the above research,so as to provide some reference for other enterprises that plan to implement share repurchase.