By Ying Xian Wong


Shares of Mr. D.I.Y. Group fell Monday, as investors continued to digest disappointing earnings from last week and reflecting investor concerns over China's zero-Covid policy.

Freight costs and higher input costs are weighing on the home-improvement retailer's gross profit margin, in addition to concerns that China's zero-Covid policy could affect the company's supply chain and logistics, says Lee Chin Hui, Rakuten Trade assistant vice president of equity research.

Shares are down 4.5% at MYR2.14, taking losses since last week's earnings release to 7.8%. If that level holds, it would tie for the stock's biggest one-day loss this year.

Mr. D.I.Y reported a 65% rise in net profit in the second quarter on record revenue last Thursday, but it fell short of some analysts' expectations, as various costs pulled the home-improvement retailer's gross profit margin 0.5% lower.

Kenanga Investment Bank and Affin Hwang Investment Bank both downgraded Mr. D.I.Y.'s stock while keeping target prices of MYR2.40 and MYR2.06, respectively.


Write to Ying Xian Wong at yingxian.wong@wsj.com


(END) Dow Jones Newswires

08-08-22 0508ET