Shares of Samsung Electronics continued to rebound Monday, recovering from the steep decline in the previous week, following the company’s announcement of a share buyback plan worth 10 trillion won ($7.17 billion) from Friday.

As of 2 p.m. Monday, Samsung Electronics shares were trading at 56,200 won, up 5.05 percent or 2,700 won from the previous trading day, according to the Korea Exchange.

The rebound comes after the shares sank to an over four-year low of 49,900 won Thursday. With the plunge in share price, Samsung Electronics' market capitalization fell to under 300 trillion won, dumping over 200 trillion won from July 11 when it reached its year-high of 88,000 won.

The shares later experienced an over 7 percent surge and closed at 53,500 won Friday, backed by retail investors’ bargain hunting.

Amid the fluctuating share prices, Samsung Electronics rolled out a stock buyback plan that same day to enhance shareholder value.

Under the scheme, the company will purchase treasury shares worth a combined 10 trillion won within a year. Of the amount, 3 trillion won's worth of shares will be canceled within three months starting Monday. The company said the remaining 7 trillion won budget will be executed within a year.

It was the first treasury share retirement plan announced by the tech giant in seven years since the 9.3 trillion won scheme in 2017.

Buying back treasury stocks and retiring them decreases the number of shares outstanding. Existing shareholders see a boost in their ownership stake when treasury shares are taken out of circulation.

In response to the sluggish stock price, company executives have been acquiring shares in Samsung Electronics to defend the stock price as well. This year, around 60 executives purchased shares worth 15.77 billion won, regulatory filings showed.

With the rebound in Samsung Electronics shares, stock prices of other affiliates in the group also surged.

Stocks of Samsung C&T and Samsung Fire & Marine Insurance gained respectively over 5 percent and 10 percent as of 2 p.m. Samsung Life Insurance shares reached a new 52-week high of 111,000 won during intraday trading, though it later dropped to 109,200 won.

Market watchers believe the Samsung Electronics stock price is likely to continue its gain for a while, bolstered by the buyback plan.

"Samsung Electronics is likely to have decided on treasury stock cancellation to boost the sluggish stock price," analyst Park Sang-wook from Shinyoung Securities said. “Though the shares have remained sluggish due to concerns on the company’s weakened competitiveness, there is a possibility that the price will continue to gain.”

Others stressed the treasury stock retirement plan is a short-term solution to boost the struggling stock price.

“Samsung Electronics’ share buyback decisions have worked as momentum for a short-term rally in the past,” noted analyst Kim Dong-won from KB Securities.

“But longer rallies have been driven by earnings growth bolstered by industry recovery," he said, adding a more stable increase will come from strengthening the company’s presence in the chip market.

With the recovery of Samsung Electronics shares, the Seoul market perked up. The benchmark Kospi surged to 2,463, up 46.14 points or 1.91 percent as of 2 p.m. The secondary bourse Kosdaq stood at 689.04, gaining 3.62 points or 0.53 percent from the previous trading day.