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MRDIY (5296) MR D.I.Y. GROUP (M) BERHAD streaks ahead to fresh high of RM2.43

KUALA LUMPUR: MR D.I.Y. Group (M) Bhd, the country’s largest IPO this year, saw its share price hit a high of RM2.43 at midday on Friday.

At 12.30pm, it was up 25 sen to RM2.43 with 16 million shares done.

The FBM KLCI was up 13.04 points or 0.82% to 1,596.72. Turnover was 4.83 billion shares valued at RM2.74bil. There were 648 gainers, 393 losers and 479 counters unchanged.

Since its listing on Oct 26 at an offer price of RM1.60, its share price has jumped 83 sen or 51.8% during the period.

Its share price has been driven by its strong earnings in the third quarter. At the current price of RM2.43, it has exceeded UOB Kay Hian Malaysia Research’s target of RM2.20.

In the analysts’ report issued on Nov 6, the research house said MR DIY’s 3Q20 earnings were within its expectations but ahead of consensus.

The quarter’s earnings matched 1H20’s earnings - growing 54% year-on-year.

“The electrifying performance is only a sneak preview of a normalised run rate for quarterly contribution, without factoring in its 20% store expansion going forward.

“Furthermore, exciting new store formats provide unencumbered competition against existing stores,” it said.

UOB Kay Hian Research said MR DIY’s 3Q20 core net profit of RM113.5mil (+54.1% on-year) brought 9M20 core net profit to RM228.9m (+1% on-year).

“This is within our estimate but above consensus expectations, as cumulative core profit accounted for 75% and 80% of our and consensus’ 2020 forecasts respectively,” it said.

Despite Covid-19 headwinds, 3Q20 represented its expected baseline contribution per store for a normalised quarter. It effectively matched cumulative earnings in 1H20 which were weighed down by the Movement Control Order, it said.

“Going forward, we expect 4Q20 to see a festivities-related seasonal boost to alleviate some softness related to the Conditional MCO. The company declared an interim dividend of 0.73 sen/share,” it said in the report.

Chief executive officer Adrian Ong was quoted saying said the company plans to increase the number of its retail stores under the brand Mr D.I.Y, Mr Toy and Mr Dollar to 900 outlets nationwide by December 2021.

To-date, Mr D.I.Y has 670 stores across Malaysia and four in Brunei.