Amtek

Amtek: Despite negative outlook for HDD and tech stocks in SG, DBSV maintains Buy on Amtek. Note that new programmes and margin improvement are key growth drivers in FY13. Apart from an enclosure programme which has started in April and still awaiting volume ramp, Amtek has been gaining market share in the office automation business. Growth would also be driven by several new automotive programmes which are scheduled to commence in 2013. Share price supported by strong dividend yield. In addition to a surprise interim dividend (DPS: 2.3 S cts) announced in May, believe Amtek would declare another dividend in 4Q12 considering healthy CFs and YTD capex of US$8m vs initial budget of US$20m. House projection is for full year DPS of 4.3 S cts based on dividend payout ratio of 55%.