Just now, Midea Group Co.Ltd(000333) ( Midea Group Co.Ltd(000333) , SZ) has offered a new share repurchase plan in 2022.
On the evening of March 10, Midea Group Co.Ltd(000333) announced that it planned to buy back the company’s shares at a price of no less than 2.5 billion yuan and no more than 5 billion yuan, and the repurchase price was no more than 70 yuan / share. The repurchased shares will be used for equity incentive plan and / or employee stock ownership plan.
The reporter of the daily economic news learned that not long ago, Midea Group Co.Ltd(000333) party just disclosed on the investor interaction platform that the amount of share repurchase implemented by the company in 2021 has exceeded 13.6 billion yuan.
Midea Group Co.Ltd(000333) repurchase plan is based on the fact that listed companies have set off a wave of share increase repurchase due to the continuous sharp decline in the market recently. Listed companies that announced the repurchase plan on the same day as Midea Group Co.Ltd(000333) include Eve Energy Co.Ltd(300014) , Memsensing Microsystems (Suzhou China) Co.Ltd(688286) , Yutong Heavy Industries Co.Ltd(600817) , Opple Lighting Co.Ltd(603515) , etc. Back to the home appliance industry, since 2022, due to the rise of raw material prices and other factors, the share price of the whole home appliance sector has been depressed all the way.
last year, more than 13.6 billion yuan was spent to buy back shares
Midea Group Co.Ltd(000333) announced on the evening of March 10 that based on the confidence in the future development prospect of the company and the high recognition of the company’s value, and based on the company’s operation, main business development prospect, financial status and future profitability, Midea Group Co.Ltd(000333) decided to continue to repurchase the company’s shares with its own funds, It will continue to be used to implement the company’s equity incentive plan and / or employee stock ownership plan, so as to further improve the corporate governance structure and build an innovative long-term incentive and restraint mechanism for the shareholding of the management team.
Under the condition that the price of the repurchased shares does not exceed 70 yuan / share, calculated according to the upper limit of the repurchased amount of 5 billion yuan, Midea Group Co.Ltd(000333) it is estimated that the number of repurchased shares will not be less than 714286 million shares, accounting for about 1.02% of the total issued share capital; According to the calculation of the lower limit of the repurchase amount of 2.5 billion yuan, the number of shares repurchased is expected to be no less than 357143 million shares, accounting for about 0.51% of the total share capital. The source of funds for share repurchase is self owned funds.
The reporter of the daily economic news noted that this is the first share repurchase plan thrown out by Midea Group Co.Ltd(000333) 2022. On March 3, Midea Group Co.Ltd(000333) said on the investor interaction platform that Midea Group Co.Ltd(000333) since its overall listing in 2013, the cumulative cash distribution will be close to 58 billion yuan. While stabilizing the dividend distribution, the company continued to launch and implement a series of share repurchase programs. After completing the share repurchase of RMB 4 billion in 2018, the company has launched the repurchase plan for three consecutive years since 2019, which is continuously used to implement the company’s equity incentive plan and / or employee stock ownership plan, so as to maintain the stability of the company’s market value and the interests of all shareholders. As of December 31, 2021, the repurchase amount implemented by the company in this year has exceeded 13.6 billion yuan.
The reporter learned that the market has fallen continuously under the influence of various comprehensive factors recently, and A-share listed companies have also ushered in an upsurge of increasing holdings and repurchase. Since March 7, a number of listed companies have thrown out share increase or repurchase plans to “protect the market”. On March 8 alone, a number of listed companies such as Haier Smart Home Co.Ltd(600690) , Zhejiang Hangmin Co.Ltd(600987) , etc. announced plans to increase shareholders’ or executives’ holdings, and companies such as 360 Security Technology Inc(601360) , Zhejiang Chint Electrics Co.Ltd(601877) , etc. disclosed repurchase plans.
the impact of rising raw material prices on the company’s operation is limited
The reporter noted that the reason why Midea Group Co.Ltd(000333) chose to abandon the share repurchase plan at this time may also be that Midea Group Co.Ltd(000333) ‘s share price has also continued to fall recently. On January 4, 2022, the opening price of Midea Group Co.Ltd(000333) was as high as 74 yuan / share, while as of the closing on March 10, the share price of Midea Group Co.Ltd(000333) was 58.87 yuan / share. Since 2022, the company’s share price has fallen by 20%.
In fact, not only Midea Group Co.Ltd(000333) , the share price performance of the whole household appliance sector has been poor recently. The “home appliance industry” sector of China stock market news has fluctuated and fell all the way since mid and early January 2022. In March, the overall decline of the sector was more obvious. Of course, the general environment here also includes that since March 3, the Shanghai Composite Index has fallen from 348111 to 329609.
Zhuang Hongdong, chairman and fund manager of cheese fund, told the daily economic news, “since 2022, home appliances have continued to decline. We think this is mainly caused by the failure of expectations.” After October last year, the prices of bulk commodities, especially metals, showed a sharp correction. At that time, the market generally expected that the household appliance sector could get rid of the phenomenon of increasing income without increasing profit due to the sharp rise of raw materials this year. Compared with the relatively poor performance base last year, this year’s performance report will be relatively bright, so the stock price generally rebounded sharply from the low point. However, the reality is that the price of raw materials has returned to the high point after falling, which is fueled by the risk of regional war. It is likely to become more and more intense and reach a new high. Therefore, the early expectation of the market has failed and the stock price has been sharply corrected.
“In addition, the disclosure of the current annual report is imminent, because the expected performance report last year may be poor, which is easy to further lead to investors’ pessimistic expectations on the basis of failed expectations.” Zhuang Hongdong said. He also mentioned that although the policies of real estate have been released frequently and there have been voices of deregulation everywhere, the sales data of January and February have been cut back continuously. Household appliances belong to the post real estate cycle, and the reality of weak real estate has also put a lot of pressure on the household appliance sector.
However, it should be noted that the reporter also learned that Midea Group Co.Ltd(000333) once said on the interactive platform of Shenzhen Stock Exchange on March 8 that the recent external turmoil had an impact on the price of bulk raw materials and the cost of the company’s products. However, on the whole, the impact of rising raw material prices on the company’s operation is limited.
