Midas

�� Midas’s 32.5% joint venture company Nanjing SR Puzhen Rail Transport (NSRPRT) and consortium partners secured RMB2.16bln contract to supply 41 train sets (246 train cars) for the Shanghai Metro Line 10 project. �� NSRPRT has an estimated 66.7% share of the contract, translating to RMB1.441bln. This contract is expected to be fulfilled between 2009 and 2011. �� These metro train cars would be the first batch of train cars in China equipped with automated driverless capability and reaffirms the market’s confidence in NSRPRT’s ability to meet new tech requirements and deliver top quality products. �� As NSRPRT is one of 4 rolling stock companies approved to undertake metro train projects on a nation wide basis in China, and given the rapid rail infrastructure expansion plans in China, the company will continue to be a key beneficiary. �� As a result, we believe there will be more contract announcements going forward which will benefit Midas’s stock price. �� With the stock trading at an undemanding forward PE of 25x versus its expected growth rate of 40- 50% as well as its peer Zhuzhou CSR Times’ forward PE of 38x, we maintain BUY.