A Case Study Of The Drivers And Effects Of Ping An Share Repurchases

Stock repurchase refers to the use of its own idle funds or debt financing by listed companies to repurchase the company’s common stock shares,so as to increase the stock price,adjust financial leverage and reduce the cost of corporate agency.Stock buybacks began in the capital markets of developed countries in Europe and the United States,and were used as an important way of capital operation to manage the market.Compared with Western developed countries,China’s stock repurchase started late,if the Western stock repurchase theory is copied,it is not conducive to the correct understanding of China’s stock repurchase,abuse of share repurchase may not achieve the expected effect,may also affect the interests of investors and small and medium-sized shareholders.Therefore,it is necessary to further study the motivation,financial and market effects of stock repurchases in combination with the actual cases of Stock Repurchase in China and the special institutional environment of China,so that stock repurchases can play a better role in China’s capital market and maintain the stability of stock repurchases in the market.This paper adopts the case study method,taking the share repurchase of Ping An Group of China as the research object,first expounds the theoretical basis of stock repurchase and the current situation and institutional background of stock repurchase in China’s capital market;secondly,on the basis of introducing the ping An stock repurchase event of China,it deeply analyzes the motivation of stock repurchase and the financial and market effects of repurchase;finally,puts forward relevant countermeasures for improving China’s stock repurchase from three aspects: investors,listed companies and government regulatory departments.The study believes that the motivation for Ping An’s share repurchase is mainly to maintain the reasonable valuation of the company’s stock price,employees hold shares,adjust financial leverage and reduce the cost of enterprise agency,etc.From the perspective of the financial effect and market effect of stock repurchase,the study believes that Ping An’s stock repurchase has increased the company’s stock price,promoted the employee stock ownership plan,and enhanced the confidence of external investors in the enterprise.The financial effects of this share repurchase are not significant.The research in this paper not only has a strong reference significance for standardizing the stock repurchase behavior of listed companies in China and rationally implementing stock repurchases,but also has a certain guiding effect on the relevant policies formulated by government regulatory departments for stock repurchases and for investors to rationally treat corporate stock repurchases and protect their own interests.