Midas

Midas: DBSV maintains Buy with $0.64 TP. The house expect firm earnings rebound for Midas in FY14F as highspeed railway (HSR) contracts roll in. Midas won its first HSR contract (Rmb168m) in over two years in October, as China resumed its HSR development programme, with more likely to come. Believe the Group could win a substantial order arising from the recent second rolling stock tender for 314 train sets, or about 2,500 train carriages. Over the next two years, believe a further 700 over train sets could be tendered for, resulting in further wins for Midas in the HSR segment. At the same time, expect (PRC) metro orders to continue flowing in, and overseas orders, which have grown substantially in 2013, to continue to be robust as Midas looks to maintain a more diversified earnings base. Maintain BUY, with 12-month TP raised to $0.64 (Prev $0.60), based on 1.2x FY14F P/BV. Believe current valuations are attractive for a stock whose earnings are poised for a strong rebound into FY14F and FY15F.