CSC's 4QFY09 net profit of S$6.7m (-45% yoy) was slightly above expectations due to the higher recognition of project revenue and improved cost management. However, its order book weakened to S$110m as at end-4Q09 from the S$190m reported in 3Q09. Although CSC guides that numerous projects from this year's government budget could materialise in 2HFY10, we do not believe it will be able to deliver on these public-sector projects in FY10-11 to reverse its revenue and earnings decline. We have cut our FY10 earnings forecast by 26% to account for its weaker order book. After our earnings reduction, our target price drops from S$0.18 to S$0.17, still based on 8x CY10 P/E, the industry's mid-cycle valuations. Downgrade to Neutral from Outperform.