The cultural transformation of a large number of dividends in the Chinese market

Through JIAXING Li and Ankur Bankjee

Hong Kong/Singapore (Reuters) -The new capitalist shadow is appearing in China's stock market. With the requirements of Beijing, the company's stock market, repurchase its stock, and return to investors waiting for SO -FAR EVASIVE Rebound repayment to repay Creating a record of dividends.

Investors said that the frenzy of stock repurchase and dividend expenditure marked the cultural change in the market, and the focus of the return of shareholders' return is similar to Japan's ongoing corporate governance transformation.

The dividend yield of Chinese stocks has risen to about 3 %, which is the highest since 2016. This is investors who have been bravely continued to invest in markets that have been invested in many years of LI. The president of the United States faces greater pressure.

BNP Paribas, Jason Lui, the head of the strategic strategy of stocks and derivatives in the Asia -Pacific region, said: “China's regulators and policy makers are trying to design such shareholders to return to culture.”

“If it can be successfully designed, it will change the composition of the capital market. You have seen some early signs,” refers to the increase in shareholders' return.

The repurchase and dividend were introduced by a part of the proposal of the Chinese authorities in September to increase the stock price and increase consumer emotions.

In recent years, the benchmark CSI 300 Index has been struggling. Since 2021, the Standard Purcera 500 index has fallen by more than 27 %. The market value of Chinese stocks has stalled for ten years, about $ 11 trillion.

Worried about the debt and property department, the pressure of shrinkage, the lack of major stimulus and geopolitical tension, damaged emotions, and led to foreign investment in Egypt. Trump's tariff threat is another concern.

Even after Beijing showed willingness to promote the market in September, the stock price lost motivation. Within two weeks after the first stimulus announcement, the CSI300 index soared 40 %, but since then, it was disappointed with the degree of implementation and the pace of implementation.

Julius chief investment officer Bhaskar Laxminarayan said: “Simple ways to see it should get enough dividend salary … let you say painfully that recovery may not happen in the valuation.” Bell.

“You get paid for this patience. If you don't do this, it is not worth it.”

Big data

Chinese companies distributed a record of RMB 24,000 (US $ 329.7 billion) in 2024. Last year's stock repurchase also rose to a record 147.6 billion yuan.

Wu Su, head of the China Securities Regulatory Commission, said on Thursday that more than 310 companies are expected to pay more than 340 billion yuan in dividends in December and January.

This is the number of companies increased by 9 times, the amount of dividends increased by 7.6 times, and the same period last year increased by 9 times.

In order to signs, how the market has become a shareholder return to become a differentiated market, investors have been steadily investing in exchanges (ETFS) with the theme of dividends. The inflow rate since 2020 is nearly 8 billion U.S. dollars, but only 273 million In the past five years, LSEG LIPPER data shows.

CSI dividend index (consisting of traditional energy, financial and material companies, generating high dividends-increased by 20 % in the past five years, while the Blue Chip CSI300 index dropped by about 8 %.

The CSI growth index sank 25 % during the same period.

Cultural transformation

Policy measures, including 300 billion yuan of RMB stock repurchase financing plans, and criteria that require mainland companies to improve shareholders' return and valuations, helping to pay attention to snacks.

Nicholas Chui said: “China has never been an asset category of the entire dividend income because it has always been regarded as a guidance.

CHUI said that about two -thirds of the stocks in the Chui investment portfolio are now at least 2 % of the income. This is not only my intentional allocation, but in fact the output of the entire market is increasing. “This is the change of culture. “

Rising dividends can also prevent mainland investors who are seeking income from being eager to deposit like a few months. Now, the dividend yield is much higher than 1.7 % that they can earn from 10 years of government bonds.

After the company announced the repurchase or dividend expenditure, the stock manufacturer's contemporary Ampere technology and e -commerce behemoth Tencent's stock rose.

Goldman Sachs estimates that Chinese companies listed at home and abroad may return a total of 35,000 yuan to shareholders in 2025, an increase of more than 17 %.

HSBC ASIA-PACIFIC's equity strategy Herald Van Der Linde said: “The company does not know where to put cash, so they now return it to shareholders. This is a great way of thinking.”

“I think you will not expect this 10 years ago.”

($ 1 = 7.2798 Chinese yuan)

(Reports by JIAXING Li and Summer Zhen in Ankur Banerjee in Singapore; other reports from Patturaja Murugaboopathy in Patturaja Murugaboopath; editor of Vidya Ranganathan and Jacqueline Wong)