Imperial generates a lot of cash (about £2-3bn p.a. in FCF), enough to buy back its entire market cap in 8 years on our forecasts. The Board has announced a £1bn buyback for FY23, and management has committed to returning cash to shareholders in future years if there are no suitable alternative uses for the cash. Combining the current share buyback (c. 5% of market cap) with the dividend yield at 7.3% in FY23E makes for a very attractive income and capital appreciation story. While the Tobacco business has stabilised and started to improve, investors are rightly concerned about the strength of the Next Generation Products (NGP) business where Imperial has recently retrenched from some markets. It is encouraging to hear that the heated tobacco trials have been successful in the Czech Republic and Greece, and that the product will be rolled out to more established heated tobacco markets including Italy, Portugal and Hungary. Likewise, trials of the new blu 2.0 vapour product in France have been positive and Imperial will now launch this product into the UK market. We expect the company will turn its attention to the struggling US vapour business once these expansions are completed. Imperial is also committed to the high margin, high growth modern oral category, where revenue grew 37% in FY22. The NGP business in total grew sales for the first time since FY19 – albeit to a level that is still just 2.7% of group net sales. We raise our adj basic EPS by less than 1% for FY23E (to 295.4p) as sterling has strengthened since we last published forecasts. Our unchanged TP is based on a CY23E PE of 9x, a valuation level we think is appropriate for now given the uncertainties around the NGP business, but with buybacks supporting EPS growth, we expect future upward revisions to the TP.