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DHG Pharmaceutical (DHG VN) – H1 2026 – Net Profit Rises 22.1% on Margin Expansion
Summary of H1 2026 results and outlook of DHG Pharmaceutical JSC (DHG VN)
- Net revenue reached VND2,561bn (+7.7% y/y). mainly driven by a robust 11.1% y/y increase in owned product sales (91.9% of revenue), while an accounting change related to promotional item partly moderated top line growth. By channel, on a like-for-like basis (LFL), pharmacy sales rose 11.7% y/y as DHG continued to expand its presence across modern pharmacy chains, whose combined networks reached 4,212 (+24.2% y/y) in Q2/2026. Hospital sales grew steadily by 8.0% y/y, reflecting a selective growth strategy focused on higher-margin products. Consumer healthcare and antibiotic franchises remained the key drivers of sales growth; meanwhile, new products in everyday symptom relief and chronic disease treatment, developed in collaboration with Taisho, provided additional growth momentum.
- Net profit rose by 22.1% y/y to VND614bn. Gross profit margin (GPM) improved by 6ppt y/y, mainly reflected the accounting change impact, alongside a more favorable product mix. Meanwhile, SG&A expenses edged up only 3.3% y/y thanks to disciplined cost control, supporting a 25.1% y/y increase in operating profit. Higher deposit rates and full debt repayment also bolstered net financial & other income.
- Recent regulatory developments increasingly favor high-quality domestic manufacturers. The number of domestic facilities meeting EU/Japan-GMP standards reached 40 by the end-Q2/2026 (+33.3% y/y), reflecting continued quality upgrades. This broader certified manufacturing base supports the government’s ongoing push to expand domestic procurement preferences by widening the list of eligible medicines, improving tender access for qualified local producers. Meanwhile, tighter controls on counterfeit medicines and the continued formalization of the pharmacy market should benefit established manufacturers as consumers and retailers increasingly favor quality-assured products. Over the longer term, pharmaceutical demand growth is projected to grow at a solid 8.0% CAGR, underpinned by an aging population, rising lifestyle-related diseases, greater health awareness, and improving healthcare access. These trends should bolster demand for common-ailment and preventive-care products, aligning well with DHG’s portfolio.
- For H2/2026, LFL revenue is forecasted to grow mildly against a high base last year, particularly in Q4/2025, when pharmacy restocking rebounded strongly as disruptions from regulatory changes eased. Growth should benefit from DHG’s strong brand equity, broad distribution network and leading manufacturing quality, with over 80% of products produced under EU/Japan-GMP standards. GPM is projected to expand 1.7ppts y/y yet remain broadly in line with H1, while normalized advertising spending and the absence of one-off provisions support year-over-year operating profit growth.
Interested in DHG? Click here to read more of our previous analysis on DHG’s quarterly earnings.
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