- We keep our target price for DHC nearly unchanged and reiterate a BUY rating. Our aggregate 2023F-2025F NPAT remains unchanged as our firmer packaging ASP forecast is offset by higher old corrugated container (OCC) cost projections. 

- We trim our 2023F NPAT by 3% due to a higher input OCC price assumption as market prices are trending ahead of our expectation. We forecast YoY changes in aggregate sales volume of -5% in 2022 and 2% in 2023.

- Both OCC and corrugated paper prices have rebounded as Chinese demand has recovered following that country’s relaxed pandemic control and lower import tariff for paper. However, the short-term pressure of the low price spread is easing, which supports a rebound in operating profits. We forecast DHC’s NPAT to rise 17% YoY in 2023. 

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