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DHG [M-PF -3.5%] - Tax incentives bolster profits amid flat in-house product sales - Update

We reiterate our MARKET PERFORM rating on DHG despite raising our TP by 4% primarily thanks to a higher PER-derived TP. DHG looks fairly valued at TTM PER of 17.6x. DHG is working with law firms and other advisors on its FOL lift, which could bolster sentiment. However, we need more concrete fundamental grounds to upgrade our view on DHG. Q1 2017 in-house product revenue and total PBT stayed flat vs Q1 2016 as DHG’s new distribution model caused some disruptions in shipments