PETALING JAYA: MR DIY Group (M) Bhd
has continued outlet rollout, and contributions from higher-productivity formats such as MR DIY PLUS and KKV should sustain earnings growth.
The recently proposed RM5bil sukuk wakalah programme is seen as a strategic step to enhance the group’s funding flexibility and support its long-term expansion plans, according to MBSB Research.
The house remains constructive on MR DIY’s medium-term outlook, supported by its scale-driven cost advantages, high-frequency traffic model and disciplined store expansion.
Its procurement scale and automation-led efficiency gains are expected to support margin resilience, reinforcing the group’s position amid ongoing consumer downtrading trends.
It maintains its “buy” call on the stock, valuing the group at 30 times financial year 2026 earnings per share of 7.33 sen, with an unchanged target price of RM2.20 a share.
With net gearing currently at 0.79 times, the sukuk facility provides management with an additional avenue to manage debt maturities and potentially rebalance its funding mix away from traditional bank borrowings.
“The move reflects prudent balance sheet management, providing the group with the ability to restructure debt while maintaining financial flexibility to support long-term growth and sustain its market leadership within Malaysia’s value retail segment,” it said.
MR DIY has lodged documents with the Securities Commission to establish a RM5bil sukuk wakalah programme, comprising an Islamic medium-term notes programme and an Islamic Commercial Papers programme with a RM1bil sub-limit, subject to a combined outstanding cap of RM5bil.
The proceeds may be used for working capital, capital expenditure, investments, acquisitions, refinancing existing borrowings and general corporate purposes, providing the group with a flexible funding mechanism to support expansion and optimise its capital structure.
