On March 22, Shenzhen listed companies Shenzhen Topband Co.Ltd(002139) , Anhui Jinhe Industrial Co.Ltd(002597) , Huafu Fashion Co.Ltd(002042) and others issued share repurchase plans, and the number of listed companies participating in share repurchase expanded again this year. For the purpose of share repurchase, Shenzhen Topband Co.Ltd(002139) said, “confidence in the future development prospects and recognition of the company’s value, based on the company’s long-term sustainable development, in order to further improve the company’s long-term incentive mechanism, fully mobilize the enthusiasm of key employees and share the company’s growth and income.”
Recently, the CSRC said it would spare no effort to maintain the smooth operation of the capital market. Give play to the role of the endogenous stability mechanism of the market, vigorously promote listed companies to improve the quality, and encourage listed companies to increase their holdings and repurchase. Under the escort and support of a series of policies, the repurchase enthusiasm of listed companies continued to rise. Since March 9, more than 24 listed companies in Shenzhen have issued repurchase plans or reports, with a total upper limit of 11.5 billion yuan. In addition, many listed companies announced that they had completed share repurchase for the first time.
full of confidence in their own value
Listed companies believe that the stock price is lower than the intrinsic value of the company and hope to convey the information that the company’s value is undervalued to the market through share repurchase. This behavior will undoubtedly help to stabilize the stock price and enhance investor confidence.
Dong Dengxin, director of the Institute of Finance and securities of Wuhan University of science and technology, told reporters that the active share repurchase of listed companies not only shows the company’s confidence in its own value, but also shows that the company has a certain amount of idle funds. Repurchase is a way to show the company’s financial strength to investors.
According to statistics, since 2022, more than 180 listed companies in Shenzhen have repurchased their shares, with a total repurchase amount of more than 10 billion yuan.
The reporter learned that many listed companies said that share repurchase is based on confidence in the company’s future development and recognition of the company’s long-term value. In addition, after the disclosure of the annual report of listed companies, they will no longer be limited by the window period. It is expected that more listed companies may participate in the repurchase and increase of shares in the future.
Gansu Shangfeng Cement Co.Ltd(000672) in recent years, the company has implemented share repurchase for the second time. This year, the company plans to use its own funds of no less than RMB 200 million for share repurchase Gansu Shangfeng Cement Co.Ltd(000672) Board Secretary Qu Hui told reporters: “this repurchase is based on three aspects of confidence: first, confidence in the development of China’s real economy; second, confidence in the healthy and mature development of the capital market; third, confidence in the development of the company’s own height and quality.”
Qu Hui introduced that although China’s economy is facing the complex international situation and the impact of China’s epidemic prevention and control, most blue chips have a solid chassis, especially the related industries led by new infrastructure, and are ushering in a new round of development opportunities. Therefore Gansu Shangfeng Cement Co.Ltd(000672) while stabilizing its existing business, it has also arranged the semiconductor industry through equity investment and developed aggregate, solid waste treatment and other businesses, and achieved good development results. Thanks to the increasingly mature and open capital market, the repurchase and other processes have become simple and convenient. The company also intends to convey its confidence in future development to investors.
optimistic about the long-term trend of China’s economy
From the repurchase situation, most of the listed companies that issued the repurchase plan have performance support, and some companies completed the repurchase at a very fast speed, and promoted the growth of enterprises by using the repurchased shares for equity incentives.
Ningbo Huaxiang Electronic Co.Ltd(002048) Board Secretary Han Mingyang told reporters that the company took only more than a week from the announcement of the share repurchase plan to the completion of the implementation of the plan. On the one hand, it is considered that the company’s share price is undervalued; On the other hand, we also hope to use the repurchased shares for employee incentive as soon as possible to support the long-term development of the company.
Han Mingyang said: “the conditions for unlocking the employee stock ownership plan are that the company will meet the operating revenue of no less than 30 billion yuan, net profit of no less than 2.1 billion yuan and net profit margin of no less than 7.0% in 2025. This goal is based on the confidence in the company’s development and industry prospects. In recent years, the sales of new energy vehicles outside China have increased rapidly, and the company has actively developed relevant businesses, which is expected to contribute to the rapid growth of performance.”
Boc International (China) Co.Ltd(601696) pointed out in the Research Report on Ningbo Huaxiang Electronic Co.Ltd(002048) that the company’s recently released performance forecast for 2021 showed that the annual net profit attributable to the parent company was 1.19 billion yuan to 1.32 billion yuan, a year-on-year increase of 40% to 55%, and the performance was slightly higher than expected. In terms of new energy products, the company has strong competitiveness in the fields of battery injection molding parts, trim strips and thermoforming, and plans to vigorously develop the business of battery boxes, which is expected to help the rapid growth of performance. The release of the employee stock ownership plan is conducive to the long-term and healthy development of the company.
Insiders generally believe that the repurchase behavior of listed companies is not only due to the needs of their own development, but also full of confidence in the long-term development of China’s economy. They believe that China will still become the most dynamic region of the world economy.
Shandong Sinocera Functional Material Co.Ltd(300285) Board Secretary Xu shaomei said in an interview with reporters that this year is the tenth year of the company’s listing on the gem. Over the past decade, the company has actively expanded its production capacity by taking advantage of the financing convenience of the capital market, developing from a single product to four business segments. Among them, electronic materials and biomedical materials are not only sectors with development potential, but also key industries supported by the state. It is hoped that the company’s shares can be repurchased for equity incentive, so as to mobilize the enthusiasm of the company’s employees.
“Backed by the platform support of the capital market, the company is confident to continue to take materials as the core and extend its influence to the upstream and downstream of the industrial chain. It will further focus on development strategy and optimize resource distribution, and focus on developing key products with market competitiveness,” Xu shaomei said
