* DGC released stellar H1 2022 results that are slightly better than our expectation as revenue increased 92% YoY — achieving 49% of our 2022F — and NPAT-MI surged 415% YoY — completing 54% of our 2022F. We primarily attribute these increased earnings to record-high selling prices and cost savings from DGC’s phosphate rock mine. 

* Q2 2022 alone recorded revenue VND4.0tn (USD174mn; +96% YoY) and NPAT-MI of VND1.8tn (USD78mn; +455% YoY). 

* We note there is a supply shortage of Chinese phosphate rock — the key input material of phosphorus products. Chinese phosphate rock prices surged 40% over the last two months. According to business intelligence company CRU Group, the Chinese government issued an export quota on phosphate, which could benefit DGC in terms of continuing elevated price spreads.

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