profit fairly easily.. Karin Technology is likely to end

Strong growth likely to continue.

showing, we believe that Karin has built a solid foundation to sustain its

impressive track record, and this will show up even more in its FY08

performance. In particular, we are pleased to see that the initiatives, like

the restructuring of its IC Application and Design (ICAD) division, that Karin

has undertaken over the past year or so are starting to bear fruits. Like we

mentioned earlier, it has also deepened its components distribution business

and one area that Karin is seriously considering is the automotive industry

in China. While the bulk of that move would come in FY09, we see it as

another engine to drive Karin to the next level.On top of the likely robust FY07

Room for upward revision.

Karin would also be focusing a lot on maintaining its margins (net at 3% or

better). Compared to its peers, Karin commands one of the highest margins

around, and this is mainly due to its continued efforts to improve efficiency

to drive operating costs lower. We are keeping our FY07 estimates (Karin

will be releasing its FY07 results around end August), and depending on

how well Karin outperforms our estimates, we would be revising up our

FY08 estimates accordingly.Going forward, besides just growing top line,

Karin remains a BUY.

rising from S$0.21 to hit an all-time high of S$0.285, or up nearly 36%.

With prices back around current levels, we see an upside of 31% from

here to our fair value of S$0.315, which is still based on 8x blended FY07/

08 PER. Coupled with an expected 7.1% dividend yield, Karin remains aThe stock has done very well since our last report,

BUY for us