Monday, February 27, 2012


Midas: has inked a agreement with Jilin Kaitong Engrg Co for a US$100m investment in building a new pdtn plant in Liaoyuan City, Jilin Province. Midas will take a 55% share, and Jilin Kaitong till own the remainder. The plant will have an annual pdtn capacity of 200k tons, and will make high precision, high spec aluminium alloy plates, sheets, strips and foils.

Separately, China Securities Journal said the Ministry of Railways (MoR) may soon relaunch the bidding for high-speed trains (ahead of previous expectations for 2H12 timeline). The industry expects the bidding to reach Rmb 30-40b, with the news likely a positive for CSR, and in turn beneficial for Midas, which counts CSR as its top 2 customers of aluminium train extrusion profiles.

Technically, the stock may have bottomed out at ~$0.31, and could be at the cusp of a new uptrend, if share price bounces off the $0.365 support (50day MA) and creates a higher low. The recent pullback now offers a better entry level, with RSI having returned to about neutral levels and with Stochastics returning to oversold levels. Initial resistance at $0.45 (near the 200day MA).

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