Amtek

Amtek: CS note that Amtek's 4Q13 net profit of US$10.9m (25% YoY) was better than expected with help from gain on sale of properties. Overall, while group revenue weakness (-7% YoY) continued, there were signs of bottoming in certain segments and margins were resilient. Reversing two years of revenue decline, some of the key segments are showing signs of bottoming: 1) casings sales have started growing due to new programmes; 2) increasing market share in automotives with new programme wins; 3) continued record tooling sales could mean higher volumes going into FY14. The key risk remains end demand. With the exception of mass storage, other segments should be helped by a recovery in global demand which could be further boosted by new programme wins. House lower target price to $0.56 (from $0.70), and revise down EPS estimates by 44-46% driven mainly by lower revenue assumptions. While timing of a demand recovery still remains uncertain, bottoming of profits, cheap valuations (6x P/E) and defensive dividend yield of 7-8% should provide downside support. Overall, maintain Neutral