Post Reply
1661-1680 of 10484
RHB Research maintains target of 75 cents for Midas
Analysts: Lynette Tan & Terence Wong, CFA
We recently hosted Midas on a roadshow in Singapore. Highlights are:
Management indicated that 1H13 will be challenging, but 2H could be stronger if things pick up.
Visibility on how soon the Chinese government will award high-speed rail contracts remains low, but management is optimistic of the government’s commitment.
Asian countries are planning to improve their connectivity by building highspeed railways to neighbouring countries and Midas is in a good position to ride on this trend.
Maintain BUY with a TP of SGD0.75, based on 1.5x FY13 P/B.
Analysts: Lynette Tan & Terence Wong, CFA
We recently hosted Midas on a roadshow in Singapore. Highlights are:
Management indicated that 1H13 will be challenging, but 2H could be stronger if things pick up.
Visibility on how soon the Chinese government will award high-speed rail contracts remains low, but management is optimistic of the government’s commitment.
Asian countries are planning to improve their connectivity by building highspeed railways to neighbouring countries and Midas is in a good position to ride on this trend.
Maintain BUY with a TP of SGD0.75, based on 1.5x FY13 P/B.
Wow, they have exceeded my target of 60 cents. Not bad. I need to revise my tp up some more. Cheers.
Peter_Pan ( Date: 25-Mar-2013 13:49) Posted:
|
It is now UOBKH's call vs. OCBCS & DBSV & DMG's calls.....
Midas Holdings - Potential to secure more orders.
Maintain BUY with a TP of SGD0.75, based on 1.5x FY13 P/B
OSK-DMG
Yes, different people have different thoughts, maybe you can share your ideas that are different from my posting. It is just a learning curve.
ruggerking ( Date: 24-Mar-2013 22:24) Posted:
|
Hi Lifeisgreat,
Maybe you can enlighthen me how the company is going to control the bottomline and make it more attractive. As I can't see in the financial statement.
1) They only mention that the increase is due to " increase in amortisation, depreciation, travelling and utilities expenses" , in two years 65% increase that is alot. Does it means that most of the amortisation account are based on increasing amortisation, then we will see even more expenses come in and the profit margin being further squeeze, how the company is going to stabilize or even reduce the administrative expense?
2) The financial cost have been increasing " are used to finance the construction of property, plant and equipment for our new production lines" . In 2010, they have dual list in HK and raised an amount of 1098m RMB. In 2010, 213m was utilised to cover the capital expenditure, etc. which is not reflect in their income statement, thus in 2010 if this is include then the net income in 2010 is only 20over m RMB. and in 2011, a 733.7m RMB was futher utilize, and this is also not reflect in the income statement, thus the actual Net income already -ve. In 2012, a further 49.2m is utilize for capital expenditure, thus in 2012 the actual net income will also be negative if without the share money from the dual list. Currently the amount leave for dual list is only 27.2m RMB.
The finacial cost increase from 9m to 73m, which is more then 8times that is alot for a company. The borrowing in 2010 is 132m RMB, 2011 is 1093m RMB and 2012 is 1471m RMB. The borrowing is much higher then the revenue and order book currently, I look at the research report seems like they are going to increase another 300m USD borrowing for the aluminium alloy production facilities, that is roughly 1800m RMB, thus the borrowing will be even much higher and financial cost will further increase. How they are going to cover all this cost? Issue rights? List for another share placement????
3) The financial statement only mention " The Group’s share of loss from its associated company, Nanjing SR Puzhen Rail Transport Co. (“NPRT”), is approximately RMB5.7 million in FY2012. This is due mainly to fewer train cars delivered to its customers during this year and which is partially offset by a recovery of expenses arising from transfer of Pearl River Delta Inter-City Train Project (Dongguan – Shenzhen Section) and Dongguan – Huizhou Inter-City Train Project to CSR Nanjing Puzhen Rolling Stock Co., Ltd due to regulatory requirement."
But from CSR financial statement till 3Q 2012 the associate earning is still positive, and just look at the way profit from associate for Midas decrease in the pass years. CSR associate maintain relatively heathy, thus they seems to be some imbalance in split of cost in the JV, and how they are going to handle this situation if the costing get worst is not mention.
Lifeisgreat ( Date: 24-Mar-2013 21:28) Posted:
|
ok noted bro. I do not agree everything cheongsl posted but at least the data extracted do help in some part of my research.
Anyway will just keep analyzing it as i do see potential in this company but definitely not on current price(my own personal opinion).
Lifeisgreat ( Date: 24-Mar-2013 03:55) Posted:
|
hi cheongsl and Blanchard, you may find most of the answers in the full year financial statement announced on 27 Feb.
cheongsl ( Date: 24-Mar-2013 13:32) Posted:
|
Got price action but always closed at the same as opening price. Doji means market is waiting and indecisive.
3 doji in a row mean going up or doing down next?
bishan22 ( Date: 24-Mar-2013 17:24) Posted:
|
3 doji in a row, no more kicks. 
No one commenting on Midas figure except Cheong? Hope someone with in depth information especially those who had been shareholder from its earlier days
No no. iPunter. I didn't flare up. =)
Just informing you I share your views too. 'Friendly Fire' - if you know what I mean. Anyway, I've been riding on MIDAS from 15 cents to 1 dollar plus... Long long time liao. So this bugger to me is like a reeling in a Marlin in the deep blue sea.. LOL!! No offence taken, and u have a good weekend! =)
Just informing you I share your views too. 'Friendly Fire' - if you know what I mean. Anyway, I've been riding on MIDAS from 15 cents to 1 dollar plus... Long long time liao. So this bugger to me is like a reeling in a Marlin in the deep blue sea.. LOL!! No offence taken, and u have a good weekend! =)
iPunter ( Date: 23-Mar-2013 15:34) Posted:
|
I don't think the train accident is the reason for the earning drops. Just look at the JV CSR, the earning did not drop, but increasing. Since you are vest, please don't feel too personal if some of my discussion might be against your expectation.
For the reform of the transport ministry, my personal view for railway transportation building industries will be more difficult, and current anti-corruption policy, profit margin will most likely be cut. Previously the bribery etc. supplier can get higher margin for contract, and current anti-corruption, company need to compete with each other base on prices, so most likely will start to see cut meat action. But need to observe further, as the way something develop is usually hard to predict.
Lifeisgreat ( Date: 24-Mar-2013 07:43) Posted:
|
Please don't mislead people that I am a shortist, as I already stated very clearly my intention is for those that not vest to avoid this counter, not suggest people to buy or short, and it is not that my comments carry much weight, it is that there are many investor that are with sharejunction, and what I stated are facts and data. As institute player, most of them practice caution in their trading. I believe the blocking will enable them to visualise the effects of the people emotion towards true data. You can observe that this type of blocking is not shown in the Hong Kong trading counter for Midas holding.
Lifeisgreat ( Date: 24-Mar-2013 03:31) Posted:
|
Hi Blanchard,
I did not vest in this counter, and most likely will not vest in the short term (within one years), as currently this counter does not have any attractive value that I am looking for.
But if you vest in this counter, then you might wish to clearified with the management and approach to enable the company to be attractive. The main concern with the company is the highlight below as shown which diminish the profit margin for the past few years.
| Midas | 2010 | 2011 | 2012 |
| CNY('000) | CNY('000) | CNY('000) | |
| Revenue | 1,029,858 | 1,080,736 | 869,506 |
| Cost of sales | -684,898 | -718,786 | -618,171 |
| Other operating income | 5,124 | 16,531 | 12,492 |
| Selling and distribution expenses | -29,229 | -40,343 | -40,381 |
| Administrative expenses | -60,785 | -82,212 | -99,974 |
| Finance costs | -9,360 | -38,766 | -73,979 |
| Share of (losses)/ profits of an associate | 45,876 | 8,290 | -5,732 |
| Income tax expense | -55,836 | -38,092 | -18,148 |
| Net Income | 240,750 | 187,358 | 25,613 |
1) The administrative expenses have been increasing from 60m to 99m in three years times.
2) The financial cost have been increasing significantly from 9m to 73m in just three years times. Major borrowing was carry out in last 2~3years, and the company also dual list in HK in 2010, how all this money was being utilised.
3) The associate profit have been decreasing for the last three years.
This will be the major concern, especially base on my previous experence working for my company for one of the project in China, I am not the PM, and it is JV between Singapore and China, as JV China party will have the major say since they are holding more share, and can control, what will be earning project will become lossing. I can say only subsequently my company and china JV breakup.
Thus it is essential for Midas to be able to audit the JV account and cost charging and also certain decision making otherwise it will become a win-loss situation. As currently the aluminium project awarded from the JV to midas the profit margin is very thin, it looks more like midas is the fat goat for CSR for this JV.
Below are CSR financial result, 4Q financial report (should be end of this month) is not out but base on 2010 and 2011 the associate portion is mostly realise in 4Q.
But for CSR the profit margin for the last few years is relatively stable and little fluctuation.
| CSR | 2010 | 2011 | 3Q 2012 |
| CNY('000) | CNY('000) | CNY('000) | |
| Revenue | 64,908,900 | 80,710,800 | 63,522,900 |
| Cost of sales | -53,478,000 | -65,305,500 | -51,784,200 |
| Share of (losses)/ profits of an associate | 611,794 | 668,034 | 199,995 |
| Net Income | 3,249,970 | 4,743,240 | 3,364,370 |
| Profit Margin | 5.01% | 5.88% | 5.30% |
Blanchard ( Date: 24-Mar-2013 11:50) Posted:
|
Cheongsl,
If your concerns about the future performances of Midas are valid, I think it is better to hear what the management is/will be doing to respond to the business dynamics.
But if your concerns are not totally valid, then there are no serious issues & I guess all are vested only if we are convinced & happy with Midas' likely future performances.
cheongsl ( Date: 23-Mar-2013 15:31) Posted:
|
now u know y i ont like to keep changing nick lol
SJ-Stomp ( Date: 24-Mar-2013 07:47) Posted:
|
Stomp-stomp ahyee, so early u alr playing polis & thieves eh....enjoy....lol
Good job!!
Good job!!
@Lifeisgreat,
"btw there are clones spotted in this thread. "
I think you are one of them!!!! 35 posts only n started to post on 28/2/13!!!
"btw there are clones spotted in this thread. "
I think you are one of them!!!! 35 posts only n started to post on 28/2/13!!!