- We cut our target price (TP) for DGW by 8% and downgrade our rating to MARKET PERFORM from OUTPERFORM.

- Our lower TP is driven by cutting our aggregate 2024F-28F sales by 7%, resulting in a 25% decrease in forecast aggregate NPAT-MI. This is partially offset by a 90% decrease in projected working capital outflow during our forecast horizon, due to (1) lower sales and (2) lower assumed inventory days of 55-59 days (vs. 57-60 days previously) following lower-than-expected inventory days in 9M 2023. We also roll over our TP horizon to end-2024F. 

- While we keep the 2023F earnings forecast relatively unchanged, we cut 2024F/25F NPAT-MI by 26%/28% due to both our lower (1) sales growth and (2) GPM assumptions for phones and laptops as we anticipate a slower ICT recovery compared to our previous forecasts.

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