S$0.34-MIDS.SI
China state owned 21st Century Business Herald reported that after the high speed rail crash in July ’11 and metro train crash in Sept ’11, China has decided to slowdown their rail projects going forward and a high level official was quoted as saying that more than 80% of rail projects currently being built will face construction slowdowns along the entire chain to beef up the quality and safety aspects. Most of these projects may face completion delays of more than a year.
Rail projects in China already completed were also asked to postpone their formal opening of operations while the government has also temporarily suspended all plans with foreign companies to build high speed railways abroad.
After unsuccessfully trying to place out shares to raise Rmb10.2bln, China CNR Corp, one of only 2 railway companies in China (and a key customer of Midas) announced that they will be scrapping their share placement exercise and instead will target to raise Rmb7.1bln via a discounted rights offering.
The continued negative news-flow on the railway sector suggests that while Midas is only 6 cents away (currently at 34 cents) from its all time listing low of 28 cents (28 Oct ’08), we would still not attempt to bottom-fish as yet.
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