Xiaomi Corp, smartphone maker company in China said on Tuesday it will buy back up to HK$12 billion ($1.53 billion) worth of stock in its biggest equity repurchase, sending its shares up nearly 7%.
Company listed its shares in July last year, has lost nearly a third of its market value so far this year. Its growth has slowed sharply as the global smartphone market has shrunk and local competition has increased.
Xiaomi’s market share in China declined by a fifth in the April-June quarter even as that of smartphone giant Huawei Technologies surged by 31%, according to research firm Canalys.
Xiaomi’s stock were also affected by losses suffered by the Hong Kong stock market, which has plunged since mass anti-government protests began in the city in June. Companies on the city’s exchange have collectively bled $152 billion in value since June.
“The board believes that a share repurchase in the present conditions will demonstrate the company’s confidence in its own business outlook and prospects,” Xiaomi said in a stock exchange filing.
Xiaomi’s current financial resources will enable it to implement the repurchase while maintaining a solid financial position, the company said.
Xiaomi shares jumped as much as 6.8% to HK$8.92 on Tuesday.
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