By jiaxing li and ankur baberjee

Hong Kong / Singapore (Reuters) – The shades of capitalism have come to the Stock Market in China and led to Record Dividends with investors waiting for a heavy rebound.

Investors say the record share buybacks and dividend payouts in a shift in market culture are driving sharehanders back to Japan’s Cormaholder.

The dividend yield of Chinese stocks has risen by 3%, the highest since 2016, many investors have been selling for years as the return of Donald Trump as US president.

“China’s regulators and policymakers are trying to engineer this culture of shareholder return,” said Jason Lui, head of Asia-Pacific equities and derivatives strategy at BNP Paribas (OTC:).

“If it can be successfully engineered, it will change the makeup of the capital market, and you’re seeing some early signs of that,” referring to the additional shareholder returns.

Buybacks and dividends were introduced as part of the Chinese authorities’ proposals in September to lift stock prices and boost stock sentiment and boost consumer sentiment.

The benchmark CSI 300 index has struggled in recent years, down more than 27% since 2021 against a 65% increase in. The market value of Chinese stocks has been around $11 trillion for a decade.

The delay in the termination of the property sector, deflegaliar pressures, lack of major stimulus and Geopolitical tension hurt a foreign investment investment. The threat of tariffs from Trump is another concern.

Although Beijing showed willingness to develop the market in September, stock prices lost momentum. The index improved 40% in the two weeks after the first announcements of the stimulus but disappointment in the degree and enthusiasm of the implementation is seen to have gained gains since then.

“The simple way of looking at it, you should be paid a dividend … so that you can get rid of the pain of the fact that the recovery does not happen in values,” said Bhaskar Laxminaray, Chief Investment Officer for Asia at Julius Baer (Six).

“You’re paid for patience. If you don’t have it, it’s not worth it.”

Lots of Data

Firms in China that distribute part of a record 2.4 trillion Yuan ($ 329 billion) in 2024. Share Buybacks also in a record high year, the data from the regulators showed.

WU Qing, 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 December and January.

That’s a 9-fold increase in the number of companies and a 7.6-fold increase in the amount of dividends versus the same period last year.

In a sign of how the market is coming to one where the return to the shareholder is a variety, investors continue to pour in sales of $ 820, compared to only $ 273 million In the last five years, Lsipper lipper data is displayed.

The CSI Divermend index – composed of traditional energy, financial and material companies that provide high dividends – has 20% of a share of 8% for the Blue-Chip CSI300 Index.

The CSI growth index fell 25% over the same period.

It’s all about culture

The policy measures, including a 300 billion Yuan Share Financack Financack Financack PROUNDIES to improve Mainland companies are focusing on high-yield companies.

“China was never a dividend-yielding asset class as a whole, because it was always seen as a growth-oriented play. But now I think we’re in a nice sweet spot where you have both growth and yield,” said Nicholas Chui , China Portfolio Manager at Franklin Templeton.

Roughly two-thirds of the stocks in Chui’s portfolio now yield at least 2%, which is “not only a deliberate allocation on my part, but the whole market on my part,” said the whole market, ” said Chui. “It’s a culture change.”

The increase in dividends will also prevent mainland investors looking for mainland investors from rushing into bonds, as they have done for several months. Dividend yields are now as high as 1.7% that they can earn on 10-year government bonds.

Shares of Battery Contemporary Thanperex Technology and E-Commerce Behemoth Tenent HE after the companies announced sales or dividend payments.

Goldman Sachs estimates that Chinese companies listed at home and abroad could return a total of 3.5 trillion Yuan to shareholders at 20%.

“Companies don’t know where to put their money, so they are now returning it to shareholders. Said Herald van der Lindes (Nyse: Head of equity strategy for Asia-Pacific at HSBC .

“I think 10 years ago, you wouldn’t have expected it.”

($1 = 7.2798)