Wednesday, October 23, 2013

********** Trading Buy: Midas. Share price: 0.51. (Can it stay above 0.500 now ? , if yes next target to 0.55 then 0.58. )

Midas has been trading below the 0.500 support turned resistance level for about 2 months since Aug 2013. Has staged a strong breakout yesterday above the critical 0.500 psychological level and today we have seen it stay above with TOP 20 volume seen still. As long as 0.500 remains as new support level, we are short term bullish with a  target at 0.55 then 0.58. Might consolidate within the 0.500 to 0.52 range before pushing higher further on momentum.
Stop loss at 0.485 for short term trades
 
OCBC – 22 October 2013
Midas Holdings: Awaken the sleeping giant
Following last week’s CNY221.8m international train and China metro contract wins, Midas Holdings (Midas) announced last evening that it has secured contracts to supply aluminium alloy extrusion profiles and certain fabricated parts for the manufacture of high-speed trains in China. These contracts are worth CNY167.5m in total, with delivery expected from 2013 to 2014. Total YTD order wins for Midas has now hit ~CNY812.6m (FY12: CNY324.9m). We view Midas’ latest high-speed train contract success as a strong re-rating catalyst for its share price given that its last high-speed contract win came in Feb 2011. We believe this may also set the momentum for further such contract wins to come, given China’s ambition to develop its rail transport sector. Maintain BUY and S$0.65 fair value estimate on Midas, based on 1.3x blended FY13/14F P/B.
 
Maybank KE – 10 September 2013
Midas Holdings: The Catalyst Worth Waiting For Is Here; Buy, $0.475 - TP $0.75
Ø  Last weekend, China Railway Corp (CRC) announced the result of its first high-speed train tender in past two years. A total of 159 train sets order have been split between CSR (108 train sets) and CNR (51 train sets).We believe this is just the beginning of a new train purchase cycle by Chinese government. Remain positive on Midas. Maintain BUY with TP SGD0.75.
Ø  We expect Midas to win around RMB250-300m supply contracts in high-speed train space this year. But it is very small compared to what we are likely to see in FY14/15. We expect Midas’ order book to reach RMB1.5b in FY15 onwards.
Ø  Historically Midas’ P/B closely followed its order book, which makes us believe that currently undemanding P/B multiples deserve a re-rating if order book could be substantially boosted to RMB1b or above.
 
 
 

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