Makihara’s equity incentive is more like a bet against heaven

2022-05-14 0 By

The half-price equity incentive of Makihara Stock is based on the growth rate of pig sales. However, the relationship between the efforts of employees and pig sales is very low, so this incentive does not need too much effort for employees, and it can be arranged by god.When Muyuan Stock launched equity incentive plan, its share price fell from a high level. Muyuan Stock is called “Pig MAO” by investors, which means Maotai in pig industry. However, investors do not seem to be impressed by this equity incentive plan.First, the price of equity incentives is too low, apparently rewarding corporate executives with investor value.The subscription price of this equity incentive is 30.52 yuan, which is about half of the latest market price on the day of announcement. Although it is in line with the provisions of the management, it will constitute an implicit deleverage of the company’s stock price, so the fall in the stock price can be understood as the result of deleverage.Second, the conditions for lifting the restriction of equity incentive are too simple.Under the equity incentive plan, the restriction is subject to a 25% increase in hog sales in 2022 and a 40% increase in hog sales in 2023 compared to 2021.This column has taken a close look at “hog sales”. The announcement does not use the word “sales revenue”, which is best understood as the weight of sales, such as kilograms or heads.The ban on condition it is easier to control, because this commodity pigs, little differentiation strategy, as long as prices are lower, is sell out, that is to say, if by the end of 2022, when it is ready for the period before the New Year’s day, Spring Festival, if sales do not meet expected standard, as long as the company depreciate sales promotion,It is easy to achieve the sales target, so in this column, as long as there is no particularly serious accident, there is almost no suspense about reaching the sales target, which is also an important reason why investors are not interested in this equity incentive.Thirdly, the equity incentive is basically unable to achieve the incentive effect for the employees of the company.Did in employees’ individual point of view, the equity incentive seems to own attitude at work does not have incentive effect, because the staff don’t know how I should work harder to achieve this release, the success was released, a key factor is the god, just as the front of this said, as long as no major accidents,Such as fire, plague and other force majeure problems, then lifting the ban almost no problem.However, there may be differences in work enthusiasm among employees, that is, employees who can get equity incentive will be complacent, while those who can’t enjoy equity incentive will have psychological imbalance, which is not good for the development of the company.Therefore, this column believes that such equity incentive is not a good thing, not only can not motivate core employees, but also may cause non-core employees to slow down. Instead, it would be better to implement the employee stock ownership plan for all employees, so as to bind the interests of employees and shareholders.For secondary market investors, to share the original such a cycle, should adhere to the periodic investment, since there is no sign that the hog cycle into the rise, so investors should give priority to with watching, average cycle stocks before entering the rising cycle period will have obvious industry, investors buy on dips stock can wait for this period.(Zhou Kejing, Commentator)