A significant number of small Chinese gaming companies have recently declared stock repurchases, a move seen as an effort to reassure investors amidst market turmoil caused by regulatory measures aimed at curbing consumer spending on games.
Last Friday, regulators released a draft of rules that would prohibit online games from rewarding players for daily logins, initial spending, or consecutive expenditures—common incentive mechanisms in the realm of online gaming.
By Monday evening, eight companies had disclosed plans to repurchase stocks totaling up to 780 million yuan ($110 million), collectively expressing confidence in the Chinese gaming industry and emphasizing the need to safeguard investor interests.
These buyback announcements follow a perceptible softening in the stance of China’s video game regulator, which issued a statement on Saturday, indicating that the government would revise the proposed rules after a thorough examination of public feedback.
Furthermore, on Monday, the regulatory body granted new licenses for 105 domestic online games for the month of December, a move that some analysts interpret as a robust signal of continued government support for the growth of online gaming.
At its core, the stock repurchase initiatives aim to stabilize stock prices, offering a measure of reassurance amid uncertainties stemming from regulatory developments.
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