Equirus Securities has initiated coverage on M&B Engineering with a ‘Buy’ rating, setting a target price of INR 515—implying an upside of ~35% from the current market price of INR 382 per share. The brokerage’s initiation note positions M&B Engineering (MBEL) as a structural beneficiary of India’s rapidly expanding pre-engineered buildings (PEB) market, supported by strong post-IPO fundamentals, capacity expansion, and a rising export mix.
Structural Tailwinds Underpinning Multi-Year Growth
Equirus highlights that India’s PEB industry has grown at an estimated 8% CAGR between FY19 and FY25, reaching nearly INR 21,000 crore, and is projected to expand to INR 33,800 crore by FY30E, implying a 10% CAGR. Post-Covid consolidation has materially reshaped the competitive landscape, with customers increasingly favouring financially robust and technologically capable players. As a result, the top eight PEB companies’ market share has risen from ~35% in FY19 to ~45% in FY25, and is expected to reach ~50% by FY30E.
M&B Engineering, according to the report, is well-positioned within this consolidation trend due to its scale, technical capabilities, and diversified product offerings.
Strong Financial Projections: Revenue, EBITDA & PAT Acceleration
Equirus projects a robust growth trajectory for MBEL over FY25–FY28E, forecasting:
- Revenue CAGR: ~23%
- EBITDA CAGR: ~30%
- PAT CAGR: ~36%
This acceleration is expected to be driven by expanding manufacturing capacity, broader solution offerings, and a steadily increasing contribution from exports.
The brokerage values the company at 15x March 2028E EPS, arriving at the INR 515 target price.
Post-IPO Balance Sheet Strength: A Key Positive
M&B Engineering made its stock market debut on 6 August 2025, raising INR 650 crore through IPO. Post listing, analysts expect the company to remain debt-free, with all planned capital expenditure fully funded.
Equirus estimates strong operating cash flows, with pre-tax CFO/EBITDA averaging ~80% over FY26E–FY28E, translating into cumulative free cash flow of about INR 200 crore over the period. This balance sheet strength provides headroom for growth without financial stress.
Capacity Expansion Across Phenix and Proflex Divisions
MBEL operates through two key verticals:
- Phenix: Pre-engineered buildings and structural steel solutions
- Proflex: Self-supported roofing (SSR) solutions
As the only AISC-certified PEB manufacturer in India, MBEL enjoys a competitive edge in high-value export markets.
Capacity expansion plans are central to the growth thesis:
- Phenix capacity is set to rise from 1,03,800 MTPA currently to 1,23,800 MTPA by FY27E and 1,43,800 MTPA by FY28E.
- Proflex will add 3,00,000 square metres to its existing 1.8 million square metre capacity.
Equirus expects consolidated revenue CAGR of ~23% over FY25–FY28E, driven by a 27% CAGR in Phenix and 7% CAGR in Proflex.
Order Book Visibility Supports Near-Term Execution
The brokerage notes that MBEL ended 2QFY26 with an order book of ~INR 930 crore, supported by monthly order inflows of roughly INR 100 crore. This provides strong revenue visibility and positions the company to capitalise on a strengthening demand cycle in industrial, logistics, and infrastructure-linked construction.
Margin Expansion Led by Exports and Operating Leverage
Equirus expects MBEL’s margins to continue expanding, supported by:
- Richer product mix: Larger and more complex PEB orders, higher in-house engineering content, and higher-margin erection work.
- Rising exports: Export EBITDA margins of 25–26%, significantly higher than 10–11% domestically. Export share is expected to rise from 7% in FY25 to 13% in FY26E and 17% by FY28E, with export realisations of about INR 2.1 lakh per tonne versus INR 1.1 lakh domestically.
- Cost advantage in global markets: Despite some narrowing, MBEL continues to enjoy a cost edge, with Phenix export pricing at USD 2,500–2,700 per tonne versus USD 4,000–5,000 per tonne in the US market.
- Operating leverage: Improved utilisation at the Cheyyar plant post commissioning (3QFY25) is expected to reduce freight costs in South India and enhance operating efficiency.
Equirus forecasts EBITDA margins of 12.9% in FY26E, 14.3% in FY27E, and 14.8% in FY28E, underpinning the projected 30% EBITDA CAGR.
Valuation & Investment View
At the current market price of around INR 382, Equirus sees meaningful upside driven by a combination of sectoral tailwinds, balance sheet strength, execution visibility, and margin expansion. The initiation with a ‘Buy’ rating is likely to reinforce positive sentiment around the stock, particularly among long-term investors seeking exposure to India’s industrial and infrastructure-led construction cycle.
In summary, Equirus’ initiation positions M&B Engineering as a structurally strong PEB play, with scale, exports, and financial discipline converging to deliver sustained multi-year growth—making the brokerage’s INR 515 target and ~35–40% upside a key datapoint for investors tracking the sector.