The Asian tobacco sector has de-rated meaningfully over the past five years amidst decelerating earnings momentum, aggressive tax hikes and ESG concerns.We believe the worst on the operating front is likely behind us for most companies- continued pricing strength along with easing of volume erosion should supportimprovement in revenue/ EBIT growth over 2021/22. Next Generation Products(NGP) progress and investment will be a key driver for sector profits andvaluations. At 14x 2022E P/E valuation looks interesting, particularly given 6.5% dividend yield for the sector. Yet we acknowledge the volatility and lower visibility of the earnings model given risks of taxation changes and technological disruption. Our bottom up picks are KT&G, HMSP and ROTH.