| Share repurchase is an important financial strategy of listed companies,which will not only have a certain impact on the market participants,but also bring certain market effect and financial effect to the listed companies themselves.With the reform of China’s share repurchase policy and the relaxation of repurchase restrictions,more and more companies join the ranks of share repurchase,and the forms and uses of share repurchase are diversified.This paper selects Midea Group’s four-year continuous share repurchase event from 2018 to2021 as the research object,first summarizes the relevant concepts and theoretical basis of share repurchase,and then introduces the background of Midea Group’s share repurchase.Then,starting from the repurchase announcement issued by Midea Group,this paper analyzes the repurchase motivation of Midea Group from the perspectives of improving the company’s stock price,implementing the employee stock ownership plan and equity incentive plan.Finally,the paper compares the effect analysis with the repurchase motivation,and analyzes the market effect and financial effect brought by Midea Group’s continuous share repurchase.This paper uses case analysis,data analysis and other methods to study the event of Midea Group’s continuous share repurchase.The findings are as follows:（1）from the perspective of Midea Group’s repurchase motivation,Midea Group’s share price does not match its own company value,and Midea Group has been implementing employee stock ownership plan and equity incentive plan for a long time,so Midea Group has to stabilize and improve its corporate value It is true that the share repurchase is used for the purpose of the incentive plan.（2）Market effect analysis shows that continuous share repurchase can stabilize and improve the stock price of Midea Group,and the announcement of share repurchase sends a positive signal to the outside world,which has a positive announcement effect;financial effect analysis shows that continuous share repurchase is conducive to improving the earnings of each share of Midea Group,which can further improve the utilization rate of its capital,and share repurchase and incentive plan After the combination,the overall value of the company can be better improved.Therefore,this paper speculates that Midea Group will continue to use its own funds to buy back shares for its equity incentive plan in the future.Continuous share repurchase can bring a lot of benefits.This paper suggests that companies can use share repurchase as a daily means of managing market value and capital operation when they have idle funds.In the context of the new policy,for companies trying to establish a long-term incentive mechanism,continuous share repurchase for the implementation of the company’s equity incentive plan will more effectively enhance the overall value of the company.Through the case study of Midea Group’s stock repurchase,I hope this paper can provide reference for other listed companies’ market value maintenance management and effective implementation of share repurchase. |
