CBN丨China's stock buyback loan program reaches 35.2 billion yuan in first month

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

• China's stock buyback loan program reaches 35.2 billion yuan in one month;
• Hong Kong outlined plans for the Hetao Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone.

Here’s what you need to know about China in the past 24 hours

Chinese listed companies have secured 35.2 billion yuan in loans through the country's stock buyback borrowing scheme launched a month ago.

So far, 152 listed firms have announced their participation in the stock buyback loan program, of which 109 with share repurchases and 43 with stakeholding increases, according to data from Wind Information. Nearly two-thirds of them are private companies.

Yesterday alone, China Resources Chemical Innovative Materials, Zanyu Technology, Tecon Biology, AiSen Semiconductor Material, and other companies announced how they plan to use the loans they have obtained.

The People's Bank of China unveiled the new re-lending facility on Sept. 24, with initial funding of 300 billion yuan, as part of a broader economic stimulus package. It officially launched on Oct. 18, and the first batch of 23 participants was announced two days later.

Commercial banks can offer stock repurchase loans at rates up to 50 basis points higher than the facility's 1.75 percent benchmark, Governor Pan Gongsheng said at a press conference. By allowing businesses and major shareholders to use loans to buy back their own shares, the PBOC aims to boost stock prices, support liquidity, and increase investor confidence in Chinese markets, Pan added.

The new financial instrument is gaining rapid market acceptance, helping stabilize share prices, boost market confidence, and promote the high-quality development of listed companies, experts noted.

Greater Bay Area, Greater future

• Hong Kong on Wednesday unveiled the development outline for the Hong Kong section of the Hetao Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone, with the gross floor area in phase one doubling from what was initially planned. The SAR section will be developed in two five-year phases, with phase one covering 1 million square meters. The plan focuses on four main objectives, including building a world-class research and development platform, creating a competitive R&D and pilot production base, fostering global innovation, and promoting institutional and policy innovation.
• The People's Bank of China successfully issued a total of 45 billion yuan of central bank bills in Hong Kong on Wednesday. Among which, 30 billion yuan of three-month central bank bills were issued at a bid rate of 3.2 percent, while 15 billion yuan of one-year central bank bills were issued at 2.6 percent.

Next on industry and company news

• China approved 112 domestic games and seven imported games this month, bringing the total of this year to 1,184 and 97, respectively, according to the National Press and Publication Administration.
• Huawei will debut its latest Xuanwu architecture and use it on its upcoming Mate X6, Richard Yu, chairman of the Chinese telecoms giant’s Consumer BG, said on Weibo today. The ultra-reliable framework has a basalt body, durable polyamide fiber material, and next-generation Kunlun glass.

Earnings reports express

• Nio’s third-quarter net loss widened 11 percent year on year to 5 billion yuan, the Chinese EV startup said in a financial report. Deliveries reached 61,855 vehicles, up 11.6 percent from a year ago and 7.8 percent on the previous quarter. Nio expects to ship 72,000 to 75,000 autos in the fourth quarter, up 44 percent to 50 percent from a year earlier.
• Meanwhile, Xpeng saw its net loss shrink nearly 54 percent to 1.8 billion yuan in the same period from a year earlier, thanks to a strong growth in sales. Revenue rose over 18 percent to 10.1 billion yuan. The EV maker delivered 46,500 cars in the third quarter, up 16 percent from the same period last year.

Wrapping up with a quick look at the stock market

• Chinese stocks closed almost flat on Thursday as the benchmark Shanghai Composite gained less than 0.1 percent while the Shenzhen Component eased 0.1 percent. Hong Kong’s Hang Seng index closed 0.5 percent lower, and the TECH index dropped 1.2 percent.

Executive Editor: Sonia YU

Editor: LI Yanxia

Host: Stephanie LI

Writer: Stephanie LI

Sound Editor: Stephanie LI

Graphic Designer: ZHENG Wenjing, LIAO Yuanni

Produced by 21st Century Business Herald Dept. of Overseas News.

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