I agree with Zen -- there will be a good run up in Midas when the Chinese govt starts tenders for railway lines again. It is inevitable - only question is how soon.
There are concerns about Midas' cash position. 2013 can be covered but business revenue must improve or else it will have to delay its capex plans for plant in Luoyang.
Midas has cash of RMB671m. It's a matter of time, maybe even just months, before the rail industry tenders re-start again.
At 28.5 cents currently, Midasâs share price is hovering near its all-time low of 26 cents.
There are recent positive developments in Chinaâs railway industry. CIMB REPORT TODAY SAYS : "We smell new contracts in the wind. A high-speed rail contract award could free Midas from the shackles of its year-long nightmare."
A few weeks ago, Midas entered into a new master agreement with Siemens. This gives me confidence in Midas ability to maintain a high barrier to entry.
Siemens will continue to engage Midas as a preferred supplier of aluminum profiles + the new contract will also incorporate ancillary services such as welding, machining and other mechanical treatment services.
Lim & Tan Securities upgraded Midas in May 2012 to a buy on the back of Chinaâs government plans to restart the railway sector investments again after having stopped it for the last year.
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