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That is very old news.... 
It may not be true but I rather keep away of this counter. Have anyone has new info on Mr Chen Wei Ping?
There is a press report in the PRC regarding Midas Executive Chairman, Mr Chen Wei Ping , being detained on alleged corruption charges in the PRC on 19 Jul 2007.
Midas looks like just breakout...:)
Midas Maintain OUTPERFORM
Road show feedback
Su Tye Chua / Research Analyst
- We hosted a road show for Midas last week, which saw the
company meet up with more than 30 investors in Singapore,
Hong Kong, London, Boston, Chicago and New York.
- Most of the investors we met were positive on the longer-term
growth outlook for the China railway sector and saw Midas as an
obvious beneficiary.
- Their key concerns were centred on potential operational risks on
the back of recent media reports of the chairman?s alleged arrest,
which proved untrue, while discussions were focused on the
company?s earnings outlook, progress at its train manufacturing
(Puzhen) JV, the competitive landscape for rail players in China,
and new growth initiatives, which we have detailed in this note.
- Midas shares peaked at 40x P/E and now trade at 22x FY08E
P/E. With earnings growth remaining strong at a 44% CAGR to
FY09E, and uncertainty about its CNELA JV venture removed, the
current risk-reward trade-off is certainly compelling, in our view.
Our SOTP-based target price implies 38% potential upside.
On growth outlook
Midas? management remains upbeat on the growth outlook for the
China railway sector, as urbanisation continues to drive the
government?s initiatives to roll out its rail transport infrastructure.
Midas remains a key beneficiary, given its leading (and growing)
market share for the supply of aluminium alloy profiles for train car
bodies. Management is targeting to raise extrusion capacity from 20k
tonnes currently, to 40-50k tonnes over the next three to five years.
On its train manufacturing JV (Puzhen)
Management expects significant contribution from its Puzhen JV going
forward, as operations ramp-up from 2H07. We expect capacity to
triple from 160 cars currently to 500 cars by end-2008. Midas? master
supply agreement inked recently with its JV partner (of which it owns a
32.5% stake), to deliver the aluminium alloy profiles for metro train
projects that Puzhen secures up till end-2010, should continue to drive
the strong order book momentum for its core business as well. We
understand that Puzhen is currently bidding for two more train
manufacturing contracts this year, and targeting five more in FY08.
On competitive landscape
The railway sector in China is highly protected, given the unique
relationship between the Ministry of Railways and its handful of
suppliers. Foreign players are required to bid for railway contracts in
China with a local partner, driven by the technology transfer
framework, which stipulates the 70% localisation content requirement
for the industry. Midas estimates that it is at least three years ahead of
the competition ? a year to scale capacity, another 12-18 months to
gain base certification (to participate in trial runs), and a further one to
two years to finally attain higher qualification standards. There are
only four licensed metro train manufacturers and three licensed high
speed train manufacturers at the national level, with Changchun
Railway Vehicles and CSR Qingdao Sifang Rolling Stock Works
licensed to undertake the production of metro and high-speed trains.
On new growth initiatives
Midas has plans to integrate downstream into fabrication, boring, or
welding processes. Management has spent S$8.5 mn so far into this
venture (trial products are currently being certified), and plans to
double its investment in the medium term, on a three-year payback.
Longer term, Midas? strategy is to evolve from being just a component
supplier into train manufacturing, a much larger market segment.
Road show feedback
Su Tye Chua / Research Analyst
- We hosted a road show for Midas last week, which saw the
company meet up with more than 30 investors in Singapore,
Hong Kong, London, Boston, Chicago and New York.
- Most of the investors we met were positive on the longer-term
growth outlook for the China railway sector and saw Midas as an
obvious beneficiary.
- Their key concerns were centred on potential operational risks on
the back of recent media reports of the chairman?s alleged arrest,
which proved untrue, while discussions were focused on the
company?s earnings outlook, progress at its train manufacturing
(Puzhen) JV, the competitive landscape for rail players in China,
and new growth initiatives, which we have detailed in this note.
- Midas shares peaked at 40x P/E and now trade at 22x FY08E
P/E. With earnings growth remaining strong at a 44% CAGR to
FY09E, and uncertainty about its CNELA JV venture removed, the
current risk-reward trade-off is certainly compelling, in our view.
Our SOTP-based target price implies 38% potential upside.
On growth outlook
Midas? management remains upbeat on the growth outlook for the
China railway sector, as urbanisation continues to drive the
government?s initiatives to roll out its rail transport infrastructure.
Midas remains a key beneficiary, given its leading (and growing)
market share for the supply of aluminium alloy profiles for train car
bodies. Management is targeting to raise extrusion capacity from 20k
tonnes currently, to 40-50k tonnes over the next three to five years.
On its train manufacturing JV (Puzhen)
Management expects significant contribution from its Puzhen JV going
forward, as operations ramp-up from 2H07. We expect capacity to
triple from 160 cars currently to 500 cars by end-2008. Midas? master
supply agreement inked recently with its JV partner (of which it owns a
32.5% stake), to deliver the aluminium alloy profiles for metro train
projects that Puzhen secures up till end-2010, should continue to drive
the strong order book momentum for its core business as well. We
understand that Puzhen is currently bidding for two more train
manufacturing contracts this year, and targeting five more in FY08.
On competitive landscape
The railway sector in China is highly protected, given the unique
relationship between the Ministry of Railways and its handful of
suppliers. Foreign players are required to bid for railway contracts in
China with a local partner, driven by the technology transfer
framework, which stipulates the 70% localisation content requirement
for the industry. Midas estimates that it is at least three years ahead of
the competition ? a year to scale capacity, another 12-18 months to
gain base certification (to participate in trial runs), and a further one to
two years to finally attain higher qualification standards. There are
only four licensed metro train manufacturers and three licensed high
speed train manufacturers at the national level, with Changchun
Railway Vehicles and CSR Qingdao Sifang Rolling Stock Works
licensed to undertake the production of metro and high-speed trains.
On new growth initiatives
Midas has plans to integrate downstream into fabrication, boring, or
welding processes. Management has spent S$8.5 mn so far into this
venture (trial products are currently being certified), and plans to
double its investment in the medium term, on a three-year payback.
Longer term, Midas? strategy is to evolve from being just a component
supplier into train manufacturing, a much larger market segment.
ericsim, congrats..thanks for sharing..i now learnt a new method
teresa, hv already make some $ from this counter last week, still awaiting gain $ to be TT to my account .. gd luck
teresa, my cal is based on 3days closing price and ave out to 1.42-1.43 off course with some call buy fm broker firm and some gut feeling (my is DBS). possible 90cts - $1 or even much lower if CEO arrested again for corruption or another fail venture etc..
Fyi from DBS dd 5/9-
��
Light Alloy Co., (NELA) has not received regulatory approval.
Story: Midas announced that the proposed JV with Northeast��
lowered our FY08 earnings by 9.5% to S$64.7m. Although growth
is now lowered for Midas, we remain positive on the Group as its
core business and Nanjing Puzhen JV should still help drive healthy
growth for the Group, riding on China?s train infrastructure
growth story. This is evidenced by the numerous contracts that
Midas as a Group has secured in the last few weeks. We have
introduced FY09 earnings forecast and are looking at c. 50%
earnings CAGR from FY06 to FY09, even excluding NELA.
Point: To account for the NELA JV being called off, we have��
price of S$1.84, which is based on 24x FY08 earnings. We have
lowered our target multiple from 27x to 24x to reflect the slower
earnings growth from the loss of the NELA JV. However, with
earnings CAGR still robust at 50% from FY06 to FY09, driven by the
existing core business and Nanjing Puzhen JV, PEG at 24x FY08
earnings remains undemanding at less than 0.5x.
oops, typo error, when i shorted at 1.47 didnt go to 1.38 so cover at 1.44..not much profit after comms...how can short at 1.50-1.52? so tempted but bcos of broker buy call, i hold first...
what lucky? i getting impatient with 1.43..lyk u waiting for 90c to $1, then i vest... last time i vest $1.38 drop further... then i shorted $1.47 then go further down to $1.38.. today merrill lynch do buy call target $1.85..what u think? ...
you are lucky this counter hover around 1.43, I expect it to hover around 90 cents to $1 after they loss the contract.
ericsim, can share how you arrive at 1.43 price? this burger seems to be hovering around 1.43
ericsim, congrats to you too, when i saw 1.44 at 5pm then change to 1.43, i knew you will get coz u que quite long. lucky i change my mind too else i wont get 1.42. see whether tomorrow can make some kopi $$ some more. Good Luck!
teresa, congrats to you. i get it at 1.43 on 1705hrs (very rare you know)...wish me good luck
ericsim, i cannot tahan. I got out at 1.44 make some kopi $$$.
patiepie, on some days make, some days lose. last month cut lose.as said earlier must have discipline to cut lose if not lose more. must know how much prepared to lose before u trade.
ericsim, good luck to both of us, i que after u at 1.42
Teresa,
thank you. i hv gone thru the website.
based on your experience, is this CFD really helping you earning $$$? How is your result since you started using it ? can you share with us ? Thanks
wow, tuapekgong u oso can tell about my voice. ya lor, people got fooled by my age when they talk to me on the phone, hehehe.... ok ok go buy 9413. huat, ah..
ttisrich, i dont hold too long in cfd. few days to 1 week bcos risky when leveraging. If against trend, then i cut lose. I havent tried Saxo.
this weekend 4D,teresa....as stated in my name...btw,u muz hv a beautiful voice..teresa....hmmmnn...
I had used CFDs for shorting. However, before using CFD, take the trouble to attend some free talks/seminars that broking houses gives on CFDs. If not sure how CFDs work, better not use it to trade, otherwise can lose a lot because of leverage. Learn first then apply.
Teresa, for POEMS,you can continue to hold onto your short positions for more than 1 month. Philips Securities will charged a finance charge on the CFDs that you had short after one month. Finance charges also applies for those CFD that are long.
Philips is not the only broking house to offer CFDs in the market. There's IG Capital, Saxo etc. Quite a few.