Study On The Motivation And Effect Of Youngor Share Buyback

As a capital operation method,share repurchase did not attract much attention in China in the early days,and the earliest share repurchase in China’s capital market can be traced back to the 1992 merger of Xiaoyuyuan by Dayuyuan.In 2018,multiple departments jointly issued the "Opinions on Supporting Listed Companies to Repurchase Shares",which provided strong support for the construction of China’s share repurchase system,greatly increased the enthusiasm of listed companies,and set off a wave of repurchase in the capital market,promoting the further improvement of the share repurchase system.Among them,more than 900 A-share listed companies issued share repurchase plans in 2021,with a cumulative repurchase amount of more than 110 billion yuan,the highest in all years.Affected by the global economic downturn and the new crown pneumonia epidemic,the capital market has fluctuated sharply in the past two years,and the stock prices of some companies have fallen irrationally,and the company’s management usually chooses share repurchase as a means of market value management in order to stabilize the stock price,which is one of the reasons for the surge in the number of repurchases in recent years.Youngor completed the second share repurchase program in 2021,this thesis uses the case study method,takes Youngor’s two share repurchases in 2019 and 2020 as the research object,and discusses the motivation and effect of the two phases of stock repurchase based on signal transmission and principal-agent theory by comparing and analyzing the financial effects and shareholder wealth effects generated under the two repurchases.Firstly,the research background,main research content,and research methods of share repurchase are introduced.Secondly,the relevant concepts of share repurchase and related research literature and theoretical basis are expounded.Thirdly,the background and process of the implementation of Youngor’s two share repurchases are reviewed,and the motivation of the repurchase is explored.Then,different performance indicators were used to analyze the impact of buybacks on Youngor’s financial effects;The impact of event research and EVA on Youngor’s shareholder wealth was analyzed;Finally,according to the content of the analysis,the conclusions of the study are drawn and some specific suggestions are put forward.Through the study of share repurchase of listed companies,this thesis concludes that(1)stabilizing the stock price of enterprises,improving the efficiency of free capital use and optimizing the capital structure,and realizing the substitution and supplementary effects of the dividend policy are the main motives for Youngor to implement the share repurchase.(2)From the perspective of the share repurchase plan formulated,the share repurchase plan formulated by Youngor is consistent with its motivation for repurchasing shares.(3)The results of the analysis of the effect of stock repurchase also prove Youngor’s repurchase motivation,the financial effect shows that in the short term,the stock repurchase will help the improvement of the asset structure of listed companies and the improvement of return per share,while the shareholder return effect shows the positive information conveyed to the outside world through stock repurchase,thereby enhancing the confidence of investors in the securities market.However,in the long run,the impact of share buybacks on Youngor Group’s financial performance and shareholder wealth is limited,and has not yet changed the downward trend of the company’s stock price.By studying the case of Youngor repurchasing shares,it provides reference and reference for the execution and application of repurchased shares by other listed companies in the capital market.