During the year, another brokerage stock announced a buyback.
On April 15, Xiangcai Co., Ltd. issued a plan to repurchase shares in a centralized bidding transaction, planning to use its own funds to repurchase 7,968,100 shares of the company's shares to 15,936,300 shares, with repurchased shares accounting for 0.28% to 0.56% of the total share capital, and the repurchase price was 10.04 yuan per share, with a repurchase amount of not less than 80 million yuan and no more than 160 million yuan (including this number).
According to incomplete statistics, during the year, nearly 10 securities firms, including Haitong Securities, Guojin Securities, Western Securities, Soochow Securities, Oriental Wealth, Huatai Securities, etc., repurchased the company's shares in a directional manner or centralized bidding transactions. Among them, Guojin Securities, Oriental Wealth, Soochow Securities, Huatai Securities, etc. are all involved in cancellation repurchases.
Xiangcai announced the plan
On April 15, Xiangcai Co., Ltd. issued a plan to repurchase shares in a centralized bidding transaction.
According to the repurchase plan, the total amount of repurchase funds is not less than 80 million yuan and not more than 160 million yuan (both inclusive), and the specific total amount of repurchase funds is subject to the total amount of funds actually used.
Specifically, according to the upper limit of the total amount of funds to be repurchased of 160 million yuan (inclusive) and the upper limit of the repurchase price of 10.04 yuan / share, Xiangcai shares are expected to repurchase about 15.9363 million shares, accounting for about 0.56% of the company's total share capital, and according to the lower limit of the total funds to be repurchased of 80 million yuan (inclusive) and the upper limit of the repurchase price of 10.04 yuan / share, it is expected to repurchase about 7.9681 million shares, accounting for about 0.28% of the company's total share capital.
According to the audited consolidated financial statements, as of December 31, 2023, the total assets of Xiangcai Co., Ltd. were 33.041 billion yuan, and the net assets attributable to shareholders of the listed company were 11.876 billion yuan. The total amount of funds to be repurchased this time is capped at 160 million yuan, accounting for 0.48% and 1.35% of the company's total assets and net assets attributable to shareholders of listed companies as of December 31, 2023, respectively.
Regarding the impact of the repurchase of shares, Xiangcai said that the implementation of the repurchase plan will not have a significant impact on the company's operating activities, profitability, financial status, research and development capabilities, and debt performance capabilities.
Xiangcai shares believe that the repurchase of shares reflects the affirmation of the company's intrinsic value, which is conducive to enhancing the confidence of public investors, maintaining the company's stock price and enhancing the company's capital market image, and creating good conditions for the company's further development in the future.
At the same time, Xiangcai also emphasized that the repurchase of shares for the implementation of employee stock ownership plans or equity incentives will further improve the company's long-term incentive mechanism, fully mobilize the enthusiasm of the company's management personnel and core backbones, improve team cohesion and competitiveness, and effectively promote the company's long-term development.
Intensive repurchase by brokers
According to incomplete statistics, during the year, nearly 10 securities firms, including Haitong Securities, Guojin Securities, Western Securities, Soochow Securities, Oriental Wealth, Huatai Securities, etc., repurchased the company's shares in a directional manner or centralized bidding transactions.
It is worth noting that in this repurchase wave, Huatai Securities, Guojin Securities, Oriental Wealth, Soochow Securities, etc. are all involved in cancellation repurchases.
On April 15, Oriental Wealth issued the "Announcement on the Completion of the Cancellation of Repurchased Shares and the Change of Shares". According to the announcement, Oriental Wealth has repurchased about 71,452,600 shares this time, accounting for 0.45% of the company's total share capital before the cancellation. After the completion of this cancellation, the company's total share capital was reduced from 15.857 billion shares to 15.786 billion shares.
On April 13, Huatai Securities issued an announcement on the repurchase and cancellation of some A-share restricted shares. It is reported that due to the expiration of the second restriction period of the previous share incentive plan, 175 incentive recipients have been granted but have not yet been released from the restricted sale of some or all of the A-share restricted shares due to personal performance not fully meeting the standard, dissolving or terminating labor relations with the company, etc., and the company will repurchase and cancel all of the restricted shares of A shares.
In addition, Guojin Securities announced on March 5 that it intends to use its own funds to repurchase the company's shares, with a repurchase amount of not less than 50 million yuan (inclusive) and no more than 100 million yuan (inclusive). The repurchased shares will be used to reduce the registered capital of the company and be cancelled within ten days from the date of completion of the repurchase.
Since the beginning of this year, why has there been a phenomenon of intensive repurchase by brokers?
Shen Meng, director of Xiangsong Capital, believes that the A-share market has been weak since the beginning of the year, and the stock price of brokerages, as an important index constituent, is relatively low, so the cost of repurchasing shares is more attractive, and it also helps to support the stock price base.
In this regard, financial commentator Zhang Xuefeng analyzed, first of all, the repurchase of shares is the behavior of a company using its own funds to repurchase its shares, which usually indicates that the company believes that its shares are undervalued or wants to increase earnings per share. The brokerage industry may be feeling the pressure of the market in some ways. Secondly, the repurchase behavior of the brokerage industry may also be affected by the market environment. For example, factors such as the macroeconomic situation and industry prosperity may affect the company's business decisions.
Regulatory attitudes are clear
Judging from the public information, the regulator's support for the cancellation of the repurchase has gradually become clear.
On January 24, Wang Jianjun, vice chairman of the China Securities Regulatory Commission, said in an interview with the media that he would further improve the quality evaluation standards of listed companies, highlight the return requirements, and vigorously promote listed companies to better return investors through repurchase and cancellation, increase dividends, etc.
The "Opinions on Strengthening the Supervision of Listed Companies (Trial)" issued on March 15 proposed to promote high-quality listed companies to actively carry out share repurchases, guide more companies to repurchase and cancel, and enhance the effect of stabilizing the market. At the same time, it is stipulated that if a listed company uses cash as consideration to repurchase shares by way of offer or centralized bidding and cancels them, the amount of repurchase and cancellation shall be included in the calculation of the dividend payment ratio.
Since the beginning of this year, the implementation of write-off buybacks has gradually become popular among A-share listed companies.
"In the past, cancellation buybacks of A-share listed companies were not very common. Because its operation is relatively cumbersome, the company needs to make corresponding adjustments in terms of law and finance. Zhang Xuefeng told reporters.
Zhang Xuefeng further pointed out that the main difference between the cancellation repurchase and the general repurchase is the procedure for canceling shares. Generally, after the buyback, the number of shares held by the company decreases, but these shares are not cancelled from the company's registered capital, but become the company's own shares. A write-off buyback will cancel the repurchased shares from the company's registered capital, thereby reducing the company's registered capital. Cancellation repurchase involves the adjustment of the company's articles of association, registered capital, etc., so it is more complicated than general repurchase.
In Zhang Xuefeng's view, the regulator's advocacy of write-off buybacks may be due to multiple considerations. On the one hand, write-off buybacks maintain the company's value and shareholders' equity by reducing the company's registered capital, improving financial flexibility and capital efficiency. On the other hand, write-off buybacks can optimize the share capital structure of listed companies and help enhance long-term competitiveness.