While peer review has been widely incorporated in assessing digital multimodal composing (DMC) to provide formative feedback, how students perceive its benefits and problems remains inadequately investigated. Drawing upon the concept of student feedback literacy, this study applied semi-structured interviews to explore students' perceptions towards peer review of a DMC task in a discipline-specific English course at a Chinese university. The findings revealed that students generally held a favourable attitude towards peer review in advancing their feedback literacy through enhancing their self-reflexivity and self-regulation of learning, improving the quality of DMC outputs, promoting a co-learning environment, and developing the knowledge repertoire of evaluating multimodal tasks. However, challenges were also identified regarding cognitive capability, time constraints, language proficiency, interpersonal relations and unwillingness to participate, with some students not fully engaging. Practical strategies such as task-based learning, additional scaffolding support and peer teaching are recommended to address these challenges. The study highlights the importance of the teachers' role in providing explicit instruction and guidance to manage peer review effectively. It expands our understanding of peer review in DMC and sheds light on improving the formative process of DMC assessment, as well as designing and managing peer review of DMC tasks.