Midas

Midas: Announced a net loss of Rmb4.9m, in-line with its profit warning. Share of loss from NPRT and higher expenses resulted in the net loss, although going forward; the group remains positive on the outlook for the PRC railway industry in 2013 and will continue to actively seek opportunities in export markets as well as other product segments. CIMB note that the house is optimistic that more HSR contracts will be dished out in the coming qtrs, with the Ministry of Railway’s (MOR) Rmb650m railway fixed asset investment target for 2013. CSR has also indicated that HSR orders may come through in 2Q13. Given Midas’ reputation as a quality supplier, house should see its orderbook grow with the addition of new HSR contracts. View the poor results as a non-event and expect the share price to be driven by upcoming orderbook momentum. Ratings as follows: CIMB maintains O/p with $0.70 TP