LHG [BUY +57.9%] - Attractive valuation; expecting profit drop in 2022F

- We maintain our BUY rating and our target price (TP) of VND61,900/share for LHG.

- Our unchanged TP is driven by LHG’s higher net cash balance as of end-Q2 2022 vs end-Q1 2022, which is offset by our 0.5-ppt higher risk free rate assumption and our extended land sales assumption in 2023-2026F.

- We maintain our 2022F IP land sales assumption of 12 ha (+9% YoY) but cut our NPAT-MI forecast by 15% due to lower-than-expected GPM in H1 2022, which we believe was mainly due to the upward revision of development costs for accumulated leased IP area. Following our extended land sales assumption for 2023-2026F, we cut our 2023-2026F NPAT-MI forecasts by 2.8% in aggregate.