Updated: 2012-09-18 (China Daily) - Shareholders in Baoshan Iron and Steel Co Ltd plan to discuss various proposals on Monday, including one calling for the company to buy back 5 billion yuan ($791.1 million) worth of its shares, sources said.
The company plans to buy back 1 billion of its outstanding shares at not more than 5 yuan each, according to a filing to the Shanghai Stock Exchange dated Aug 28.
"There should be no reason why the proposal wouldn't get the green light at the shareholders' meeting," Liu Junqing, a steel industry analyst from Shanxi Securities Co Ltd, was quoted as saying by Xinhuanet.
The same day the steelmaker's plan was announced, the company, commonly known as Baosteel, saw its shares rise by the upper daily limit. From then until the closing of the market on Friday, the stock's price increased by 13.8 percent.
According to the plan, the 1 billion shares that are to be repurchased constitute about 5.7 percent of the Shanghai-listed steelmaker's capital stock, and the purchase is meant to boost Baosteel's stock price amid bearish sentiment in the market for A-shares, which are denominated in renminbi and traded on mainland exchanges.