We reiterate our BUY rating for DXS despite cutting our target price by 14% to VND28,200/share.

Our lower target price is mainly due to (1) a 7% decrease in our aggregate 2022-2026F NPAT-MI forecast amid our lower expected revenue growth and higher interest expense projections, (2) a higher net-debt balance as of end-Q2 2022 and (3) our 0.5-ppt higher risk-free rate assumption, which are partly offset by a higher targeted P/E of 11.0x vs 10.5x as previously.

We forecast 2022F NPAT-MI of VND973bn (USD42mn; +81% vs 2021’s low base) as we expect profit growth to accelerate in H2 2022F, which is attributed to the stable performance of the northern region as well as the improvement of the central region (revenue showed signs of recovery in Q2 2022) and DXG projects (Gem Sky World & Gem Riverside) supporting the southern region’s performance. The 18% decrease to our 2022F NPAT-MI forecast is mainly due to weaker-than-expected H1 2022 sales activities and our higher interest expense forecast.