Midas

Midas: China will spend Rmb1.27tr by 2015 to build 2,600 km of subways and light-rail train systems in urban areas. The investment will include Rmb170b for urban rail in Beijing and Rmb128b in Shanghai. This could lead to more order wins for train set makers such as Midas, whose shares have been hit by bad sentiment surrounding 2 high-speed train collision & a high level corruption scandal. The company recently clinched 2 metro contracts worth $3.13b by its 32.5%-owned associate, Nanjing Puzhen to supply 402 train cars for Nanjing Metro Line projects. Valuations are undemanding at ~8x FY11 P/E.