Midas

Midas: Credit Suisse downgrade to Neutral from O/p and slashes TP to $0.45 from $0.70, Note that downside risk to FY11-13E earnings, based on its YTD order book growth profile, has so far secured just Rmb322.5m in new aluminium extrusion contracts, significantly below levels witnessed in 2009/10, and vs expectation of Rmb650m for FY11.

Expect the China railway sector to continue facing short-term headwinds, given the shakeup at the MOR, and recent safety concerns. Believe this could result in a delay in railway infrastructure expansion, as well as a possible shift away from highspeed rail investment, based on contract flow so far. Cut forecasts on lower utilisation at its extrusion facilities, and lowers expectations for the Puzhen JV contribution, given the ramp-up so far. FY11-13E earnings are lowered by 12-20 %.