Zheng Quan Shi Bao Wang·2025-12-15 05:16Core Viewpoint - The Hong Kong stock market is experiencing a new wave of share buybacks, primarily led by major technology companies, which signals positive long-term development for these firms [2][5][8]. Group 1: Buyback Trends - Since November, Hong Kong listed companies have repurchased over 700 million shares, a significant increase compared to previous months where monthly buybacks were 260 million, 530 million, and 530 million shares respectively [3]. - In December, the trend of active buybacks has continued, with over 270 million shares repurchased in just the first few trading days [3]. - Tencent Holdings has resumed its buyback program since November 18, repurchasing over 1 million shares daily with amounts exceeding 630 million HKD, which is a notable increase from its previous buyback scale [3]. - Xiaomi Group initiated a new round of buybacks on November 20, with total repurchase amounts exceeding 2.9 billion HKD in less than a month, representing over half of its total buyback amount since 2025 [3]. Group 2: Leadership of Technology Companies - Major technology companies like Tencent and Xiaomi are leading the current buyback wave, with their buyback amounts ranking at the top in the Hong Kong market [5]. - Other tech firms such as Kuaishou and Kingsoft are also beginning to appear on the buyback leaderboard, while non-tech companies like HSBC and Anta Sports have seen a decline in buyback activity [5]. Group 3: Rationale Behind Buybacks - Experts suggest that companies typically choose to buy back shares when they believe their stock is undervalued, and they avoid buybacks during earnings blackout periods to mitigate risks [6]. - The buyback strategy is often influenced by regulatory constraints, financial strength, and market sentiment, with leading firms having more substantial financial resources to execute larger buybacks [6]. Group 4: Long-term Implications of Buybacks - Share buybacks can optimize a company's equity and financial structure, enhance earnings per share, and improve return on equity, making the company more attractive to investors [8][9]. - Continuous buyback actions signal to the market that a company's value is underestimated and that it has stable cash flow, which can help maintain investor confidence and attract institutional investors [9]. - However, the effectiveness of buybacks is contingent upon the company's fundamental performance; relying solely on buybacks without improving business operations may lead to long-term challenges [9].