EHang authorises $30m share repurchase

The board of EHang Holdings has approved a $30m share repurchase programme of its American Depositary Shares (ADS) or ordinary shares over the next 12 months.

The company plans to repurchase shares via open market transactions, private negotiations, block trades and other means.

The timing and amount of repurchases will be determined by the company’s management based on market conditions, trading volume, working capital requirements, general business conditions and other relevant factors.

The company will utilise its existing cash balance and cash generated from operations to fund the repurchases.

“This share repurchase program underscores our confidence in EHang’s long-term growth potential as well as our capability in continuously delivering value to our shareholders. Looking ahead, we remain focused on advancing our leadership in providing safe, pilotless, and sustainable eVTOL solutions in the Urban Air Mobility sector, while maintaining a disciplined approach to capital allocation to ensure sustainable growth and profitability,” said Huazhi Hu, founder, chairman and CEO of EHang.

Buybacks are often undertaken by the company to signal confidence in future, potentially boost their stock price and enhance shareholder value.

By reducing the number of shares, the earnings per share (EPS) can increase, making the stock more attractive to investors. Additionally, repurchasing shares can be a way to return excess cash to shareholders, especially if the company believes its shares are undervalued.

EHang’s ADSs, which began trading on the Nasdaq Global Market in December 2019, are currently trading for $13.29.

EHang was listed on Nasdaq Global Market in December of 2019 with its American Depositary Shares (ADSs) trading under the symbol “EH”. The company raised $40m through its initial public offering (IPO) at a price of $12.50 per ADS, valuing the company at approximately $687m.