BAIC Group plans up to 250 million yuan buyback for three units

BAIC Group plans to buy back as much as 250 million yuan ($34.5 million) of shares in three listed subsidiaries, the state-owned automaker said Thursday.

"BAIC Group firmly believes in the long-term positive fundamentals of China's economy and fully supports the high-quality development of its listed subsidiaries," the company said in a statement.

The buyback covers BAIC BluePark (50 million yuan to 100 million yuan), Foton Motor (50 million yuan to 100 million yuan) and Bohai Automotive (25 million yuan to 50 million yuan). The company also pledged to pursue mergers and acquisitions and inject high-quality assets into its listed units, focusing on new energy and intelligent driving sectors.

The coordinated buyback by a major state-owned enterprise signals government-backed support for China's A-share market. It could trigger similar announcements from other Chinese SOEs, providing a floor for auto sector stocks.

The announcement comes as Chinese authorities encourage state-owned companies to boost shareholder returns and stabilize markets. BAIC Group said it will "steadily increase" support for its listed units and help them improve operational quality and investor returns.

BAIC BluePark, the electric vehicle arm of BAIC Group, has been under pressure amid intensifying competition in China's EV market. Foton Motor, a commercial vehicle maker, and Bohai Automotive, a parts supplier, also face headwinds from slowing domestic demand.

The buyback plan, while modest relative to the companies' market capitalizations, carries symbolic weight as a signal of state backing. Chinese policymakers have been pushing SOEs to enhance shareholder value through buybacks, dividends and asset restructuring.

The buyback signals that BAIC Group expects its listed units to benefit from consolidation in China's auto sector. Investors will watch for details on asset injection targets and the timeline for execution.

This article is for informational purposes only and does not constitute investment advice.