DRC - HOLD - Margin peaked, value fair - Update
We believe DRC’s gross margin will remain at its peak of 25.5% in 2Q13 for 2H13. We believe rubber price has bottomed and will remain weak. DRC is trading at 12m forward PER of 9.7x, in-line with our target PER of 10x, the highest PER range of the company since Oct-09. The company’s 1H result was in-line with our forecast. Discounting all these factors, we maintain our target PER at 10x, translating to 12m target price of VND41,100/share (vs VND42,000 in 1Q13 update).