- Management's estimated H1 2022 NPAT-MI of VND250bn (USD11mn; -17% YoY; 46% of our 2022F) is in line with our expectation. We attribute the YoY decline to 1) tax incentives at DHC’s second paper factory phasing out in 2022, and 2) Q1 2021's low input material cost which caused a high base in earnings for comparison YoY.

- DHC’s 2022 guidance: 

 * Revenue of VND3.9tn (USD170mn; -6% YoY; 90% of our forecast). 

 * PBT of VND515bn (USD22mn; flat YoY; 83% of our forecast).

 * NPAT of VND450bn (USD20mn; -7% YoY; 83% of our forecast).

 * We note that DHC has a track record of exceeding its profit guidance. In 2021, DHC’s NPAT surpassed its annual target by 7%. As such, we do not anticipate material downside risk to our 2022 forecasts, pending a fuller review.

- In order to supplement working capital, DHC will issue shares via ESOP and a rights issue at VND27,000/share that are equivalent to 14% of existing shares in total.

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