Venture

Venture: Citi maintains Buy but cut TP to $8.80 from $9.20. Estimates assume YoY EPS growth to stay flattish before a 17% YoY rebound in 2013. Margin assumptions remain largely intact and house assume the gross margin to remain above 22%. DPS estimate of $0.55/shr is kept unchanged as VMS will continue to generate positive free cashflow. House continue to like VMS for its resilient margins and attractive div yield (7%), although reduce FY12 YoY sales growth estimate to 5%, from earlier 10%. The contraction arises from all divisions with the exception of RSSI. Add however that Prospects do not appear promising in the near term as a recent new mobile printer (P&I) launch has not seen volume picking up while the on-going weakness in PC Peripherals is not easing as the corporate capex cycle remains soft. Take-up from new product launches in Test and Measurement also continues to be slow.