Venture

Venture: Announced 1Q11 results which were in-line albeit at the lower end of estimates, with rev at $587.6m, -8.1% YoY and -16.7% QoQ, while Net Profit at $41.2m, +4.4% YoY and -24% QoQ. Slightly lower YoY rev due to lower value-added business in Printing and Imaging segment which was phased out, while a declining USD also contributed to reduction in Grp’s rev. Net margins however improved to 7.0% vs 6.1% YoY, on back of lower raw materials costs and consumables used.....

Going forward, grp continues to be cautious on outlook, but tip demand from customers in the Test and Measurement, Retail Store Solutions and Industrial segments to improve over next few qtrs. In addition, several new products and programmers are scheduled to be launched in 2H11, although the value of USD is expected to continue impacting on Grp’s rev....

We note that grp’s balance sheet remains strong, with net cash position of $254.9m and at current price, trades at an annualized 16x FY11E P/E vs historical average of 15x and peers of 16x, with div yield of 5.7%. Street has a unanimous Buy rating on grp with mean TP of $11.55, tipping multiple new ODM and own-brand product launches coming in 2H11, to boost stronger sales growth and further margin improvements.