| In the international capital market,stock repurchase is a mature capital operation tool,which can be used to adjust the capital market.It can also as a means of improving corporate equity structure and implementing scientific management.In the early stage,the capital market began to implement market regulation measures,hostile takeover was increasingly prevalent in the fierce market competition,and stock repurchase became an anti-takeover strategy for companies to maintain control,which protected the stability of the capital market and stock market.Of course,when the foreign securities market is relatively mature,stock repurchase has become a legitimate capital operation of the company,and the corresponding stock repurchase market has become an important part of the international financial market.Compared with foreign capital market and stock repurchase market,China's capital market is still in the primary stage of development.China securities regulatory commission has allowed listed companies to realize stock repurchase behavior,especially after the reform of non-tradable shares,the maturity and perfection of China's capital market has become an inevitable trend,and the corresponding listed companies' stock repurchase must become their operation mode in the capital market.The government of our country has transformed from the previous management type to the service type,and the restrictions on stock repurchase have also been relaxed,and corresponding laws and regulations have been issued successively.Particularly,the company law has revised the provisions on the content of stock repurchase in the past two years.In 2015,the revised company law stipulates the new purpose of share repurchase,allowing joint-stock companies to implement share repurchase under four conditions.In 2018,the new company law amended the provisions on share repurchase mainly from three aspects: expanding the intensity of share repurchase,improving the decision-making process of share repurchase and establishing the stock system.However,it is worth noting that China's securities market also has its own characteristics.Because of the restrictions of policies,the stock repurchasing in China started late and the number of repurchase is small.Therefore,the relevant theories of foreign stock repurchase are not completely applicable.This paper adopts the method of combination of normative research and case study to study the influence of the stock repurchase of Lian Chuang electronic company on the company's operating condition,and draws the conclusion that the main reason of stock repurchase are the undervaluation of stock price,stock repurchase can consolidate the control right of the controlling shareholder,stock repurchase can help improve the shareholder's wealth and so on.Its contribution mainly lies in:(1)analyze the main motivation,characteristics and economic consequences of the share repurchase of listed companies based on the actual situation of China's stock market,and provide a case study of the share repurchase of Chinese companies;(2)it elaborates the typical experience and matters needing attention of successful implementation of stock repurchase;(3)provide reference cases for China's listed companies to implement stock repurchases.This paper consists of five chapters in total: the introduction is in the first chapter,which primarily reviews and summarizes the research status of domestic and foreign scholars on stock repurchase,points out the research shortcomings,elaborates the writing background and significance of this paper,at the same time elaborates the research ideas and methods of this paper,and constructs the overall framework of this paper.The second chapter summarizes the theory of share repurchase,introduces the concept of share repurchase,summarizes the motivations of share repurchase,summarize that the motives for share repurchase include preventing mergers and acquisitions,transmitting positive signals to the market,and optimizing capital structure.introduces relevant regulations and systems about share repurchase,expounds the main methods,and finally introduces relevant theories,laying a theoretical basis for the analysis of this paper.The third chapter is the introduction of Lian Chuang Electronic Technology Co.,Ltd's stock repurchase case.First,I introduced the general situation of Lian Chuang Electronic Technology Co.,Ltd.,introduced the overall event of the company's stock repurchase.Meanwhile,I introduced the motivation of Lian Chuang Electronic Technology Co.,Ltd to conduct stock repurchase in detail.At the same time,the motivation for Lian Chuang Electronic Technology Co.,Ltd.to carry out stock repurchases is that the company's stock price is undervalued,financial leverage is adjusted,shareholders' wealth is increased,and positive signals are transmitted to the market.Chapter four analyzes the impact of Lian Chuang Electronic Technology Co.,Ltd's share repurchase on the company's operating and financial conditions.This chapter analyzes the financial statements and stock prices of Lian Chuang Electronic Technology Co.,Ltd.This chapter mainly analyzes the changes of the company before and after share repurchasing,and analyzes the influence of share repurchase on the company from three aspects: the company's equity structure and share price,the company's profitability and the company's ability to resist risks.The impact on the company's shareholding structure and stock price has increased the shareholding ratio of major shareholders,increased the company's financial leverage,and improved share prices.The impact on the company's profitability is the increase in EPS after the repurchase,the increase in the return on net assets,and the change in the company's cash flow.The impact on the company's ability to resist risks is that a cash reduction without affecting the company's long-term solvency and increasing the capability of coping with hostile takeovers.The fifth chapter is the conclusion and inspiration of case study.This chapter concludes from the analysis in the previous chapter that the main reason for stock repurchase is that the stock price is undervalued.The stock repurchase can consolidate the control of the controlling shareholder and help to increase shareholders' wealth.This chapter draws a conclusion through the analysis in the previous chapter,and summarizes the key points and key factors of share repurchase to provide help for the application of share repurchase in Chinese enterprises. |
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