| Share repurchase refers to the behavior of listed companies using their own funds or debt financing to repurchase shares issued or circulated by the company.China’s share repurchase started late and the relevant laws are not perfect.There are certain differences in the purchase.For example,the share repurchase is often used by listed companies as a means of reducing state-owned share in“ownership structure” period.During the period of share-trading reform,the characteristics of “debt payment in stock”of listed companies’ share repurchases were obvious.With the continuous development of China’s market economy and capital markets,the incentives for listed companies to repurchase shares have gradually diversified.The more listed companies are hoping to implement repurchase to achieve the effect of stock price increase and so on.The 2015 “stock disaster” as the background,based on the research results of share repurchase and related theories,this paper sorts out the development history and current characteristics of China’s share repurchase.And choose the highest share repurchase amount and the largest proportion in the first half of 2016 of Xinhu Zhongbao shares repurchase as a research case,with the real estate industry represented by it as the research object,using literature research method,case analysis method and event research method to explore and research on the motives,the design of repurchase design,repurchase implementation points,and the economic consequences of Xinhu Zhongbao share repurchase.The article finds that the external reason for the repurchase of shares in Xinhu Zhongbao in 2016 is that the stock price has fallen sharply,and the policy encourages that enterprises urgently need to restore investors confidence.The internal reasons include that shareholders hope to reduce tax payment of dividends through stock repurchase.Besides,one of the driving forces for corporate share repurchase is that it has just completed the private placement at the end of the 15 th year,the company can repurchase the stock using lower price and increase earnings per share.Through the review of the repurchase plan of Xinhu Zhongbao,it was found that its repurchase pricing and repurchase timing were constrained by the market environment and the stock price.Xinhu Zhongbao was well prepared and prevented measures for this repurchase.The private placement of funds and the shareholding pledge financing of the controlling shareholder to alleviate the cash flow shortage crisis,and the “double insurance” guarantees the smooth implementation of the repurchase program.Finally,this paper explores the economic consequences of the repurchase of Xinhu Zhongbao.The article finds the share repurchase can increase the stock price,reduce the equity capital of the enterprise and optimize the capital structure,but it will increase financial risk.In addition,this paper finds that the more corporate governance layer understands the internal management of the company,the more it tends to retain the company’s shares,because the share repurchase will bring more to the stockholders.Through the comprehensive analysis of the case,this paper reveals the commonality and characteristics of listed companies’ share repurchase under the background of "stock disaster",and explains the differences in share repurchase of listed companies through the exploration of case personality.Listed companies need to recognize and rationally use share repurchase measures,plan and formulate effective repurchase plans in advance,and multi-channel financing to reduce the risk of share repurchase.Writer hopes that through the research of this paper,it can provide practical experience for real estate enterprises to carry out share repurchase,and provide reference for the share repurchase of listed companies in China. |
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