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MR DIY closes at RM1.75 for 15 sen premium in debut on Main Market

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PETALING JAYA: Malaysia’s largest home improvement retailer MR DIY Group (M) Bhd made its debut on the Main Market of Bursa Malaysia Securities today, closing its first trading day at RM1.75 with a 15 sen premium on 410.15 million shares traded.

The stock moved between a high of RM1.80 and a low of RM1.50, compared with its offer price of RM1.60.

“We’re pleased to be listed. It’s a proud moment for us as we welcomed over 9,000 shareholders to our company,” MR DIY executive director and CEO Adrian Ong Chu Jin told a virtual press conference after MR DIY’s listing today, the largest on the local bourse this year.

The IPO raised RM1.5 billion from both institutional and retail investors, as MR DIY plans to open 307 new stores across all its brands, including household products store MR Dollar and toy store MR Toy, in 2020 and 2021, having earmarked a capital expenditure of RM438 million for this.

Currently there 674 stores across the three brands in Malaysia and Brunei.

“Our focus is to continue to add stores in Malaysia and Brunei. We invested in MR DIY with a target payback of two years, which we benchmark against our (other) businesses. It’s early to say the payback period for our other businesses (MR Dollar and MR Toy) but we’re cautiously optimistic these businesses will bring value to our shareholders,” said Ong.

He said the Malaysian home improvement market is expected to be worth RM12.5 billion by 2024, growing at a compounded annual growth rate (CAGR) from 2019 to 2024 of 10.2%. MR DIY is a market leader with an estimated 29.1% market share in the country in 2019, according to Frost & Sullivan.

“The overall fundamentals of this business are intact. We continue to grow market share, same store sales growth and new brands that we add to our retail platform. All these levers put us in a good and strong position to allow our shareholders to benefit in the long term.”

MR DIY group posted an aggregate revenue of RM465.6 million for the two months of May and June 2020 during the post-movement control order period, 12% higher than RM416.1 million recorded in the two months of January and February 2020.

Overall, from 2017 until 2019, MR DIY’s revenue and net profit recorded a CAGR of 36.1% and 23% respectively.

“Being in a growth sector that allows us to add market share, return our capital and still pay dividend to shareholders… We’ve growth and income together. Many companies don’t have that,” Ong said of MR DIY’s dividend policy that targets to return 40% of its earnings to shareholders.

He added that the company will continue to invest in the business, improving operations, IT systems, data management, and ultimately building the business to greater heights and scale.

“We will continue to be ‘always low prices’. We believe in offering quality products and at low prices in a structure that is convenient for customers to come to, whether small towns, East Malaysia, or big cities. We want to be able to offer our products to all Malaysians,” said Ong.

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