Company Quarterly Earnings Update – DHG VN – 2021 Q1

Summary of the 2021 Q1 results of Hau Giang Pharmaceutical JSC (DHG VN)

Q1/2021 results highlights:

  • Net revenue was VND1,017bn, +18.5% y/y. DHG’s own product revenue accounted for 79% of the total, increasing by 5.2% y/y while promotional revenue more than doubled as some promotion packages for sales in Q4/2020 was only recorded in Q1 this year. Breakdown by sales channel stayed similar as in previous quarters: ~85% of revenue came from sales in pharmacies while the remaining from hospitals and clinics via the national healthcare insurance scheme.
  • Gross profit grew at the same pace with own product revenue growth rate. Operating expenses, on the other hand, reduced slightly as the company continues its efforts to streamline and to improve efficiency of its workforce – which reduced by 8% since Taisho became a shareholder till now.
  • The financial position remained solid: cash and deposits were 52.9% of total assets, and leverage was minimal (D/E and D/A of 0.12x and 0.09x respectively).
  • It paid 2020 dividend of VND4,000/share on 18 May 2021.


  • The fourth wave of Covid19 started in Vietnam since late April. The government has swiftly reacted and most of the new cases in the recent days are those already under quarantine because of their having contacts with prior cases, before tested positive. The IQVIA estimates Vietnam’s pharmaceutical spending to increase by 8.0% in 2021 after a 3.8% growth in 2020.
  • We retain our forecasts for DHG. Its growth venue will continue to be pharmacies. In terms of products, DHG focuses on basic generic drugs such as pain relief, antibiotics. With the support from its now controlling shareholder – Taisho Pharmaceutical Co. Ltd., DHG aims to have more types of supplements, skincare, and cosmetics.
  • We expect DHG’s net profit to grow by 6.2% in 2021 and 8.4% in 2022.

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