M&B Engineering
- M&B Engineering is coming out with a 100% book building; initial public offering (IPO) of 1,77,65,523 shares of Rs 10 each in a price band Rs 366-385 per equity share.
- Not less than 75% of the issue will be allocated to Qualified Institutional Buyers (QIBs), including 5% to the mutual funds. Further, not more than 15% of the issue will be available for the non-institutional bidders and the remaining 10% for the retail investors.
- The issue will open for subscription on July 30, 2025 and will close on August 1, 2025.
- The shares will be listed on BSE as well as NSE.
- The face value of the share is Rs 10 and is priced 36.6 times of its face value on the lower side and 38.5 times on the higher side.
- Book running lead managers to the issue are Equirus Capital and DAM Capital Advisors.
- Compliance Officer for the issue is Palak Dilipbhai Parekh.
Profile of the company
The company is one of India’s leading Pre-Engineered Buildings (PEBs) players. Its business is structured into (a) Phenix division which provides comprehensive solutions for PEBs and complex structural steel components; and (b) Proflex division which provides self-supported steel roofing solutions. It offers its customers comprehensive turn-key solutions which include project design, engineering, manufacturing and erection in accordance with customer requirements across industrial and infrastructure segments. It has delivered solutions for its customers engaged in diverse sectors including general engineering and manufacturing, food and beverages, warehousing and logistics, power, textiles, and railways.
Its Phenix Division (i) provides comprehensive solutions for PEBs which includes estimation, designing, engineering and manufacturing of PEBs and their components within the controlled environment of its Manufacturing Facilities, which are then supplied, installed and erected under its team’s supervision at its customers’ manufacturing sites; and (ii) manufactures complex structural steel components for its customers across a variety of end-user industries for projects including the construction of bridges, flyovers, power plant structures and other industrial applications. Through the Proflex Division, it manufactures and installs self-supported steel roofings for projects across India.
Its manufacturing infrastructure is complemented by its stringent quality and safety standards and processes which are evidenced by its ISO certification. Its domestic presence is anchored by its marketing head office in Ahmedabad which is complemented by a strategic network of regional offices or representatives stationed in key cities across India including Mumbai, Chandigarh, Jaipur, Lucknow, Rajkot, Surat, Nagpur, Pune, Hyderabad, Delhi, Chennai and Bengaluru. Its representatives situated in various regions serve as marketing agents, facilitating business development activities for the company.
Proceed is being used for:
- Funding the capital expenditure requirements for the purchase of equipment and machinery, building works, solar rooftop grid and transport vehicles at its Manufacturing Facilities.
- Investment in information technology (IT) software upgradation by the company.
- Re-payment or pre-payment of term loans, in full or in part, of certain borrowings availed by the company.
- General corporate purposes.
Industry Overview
Pre-engineered construction has emerged as an innovative building method due to rapid growth of automation in the construction industry. Furthermore, shortage of skilled labour, combined with the inherent advantages of these structures in terms of speed, cost-effectiveness, and environmental impact, is significantly propelling their popularity in the construction sector. Pre-engineered structures/units are more eco-friendly than traditionally constructed ones and provide common benefits such as reduced material wastage, enhanced quality control, and improved onsite safety. The controlled manufacturing process minimises material wastage, promoting sustainable building practices, while rigorous quality control ensures consistent and durable structures.
Pre-engineered buildings were introduced in India during the late-1990s/2000s with the onset of India’s economic growth post liberalisation in 1991. However, the acceptance among consumer verticals began in early-2000 with good growth during 2005- 2010. Pre-engineered buildings started gaining prominence following a strong fixed capital formation in India and increased adoption by customers. This period of high growth saw new players enter the fray. With the slowdown of India’s economic growth, the Indian pre-engineered buildings industry stagnated between 2010 and 2015. Post that, the industry saw good adoption but suffered some slowdown as capex declined during the pandemic, leading to a drop in revenue in fiscal 2021.
The industry expanded at a CAGR of around 8.3% over fiscals 2019 and 2025, growing from Rs 130 billion in 2019 to Rs 210 billion in fiscal 2025, driven by increased construction investments and growing awareness of PEB and its advantages. The medium-term outlook is optimistic, with the industry expected to clock a CAGR of 9.5-10.5% between fiscals 2025 and 2030 to Rs 330-345 billion, supported by investments in the industrial and infrastructure sectors, such as warehouses and logistics as well as expressways (wayside amenities and toll plazas).
Pros and strengths
One of the leading players in terms of installed capacity in the domestic PEB industry: The company is one of India’s leading PEBs players (installed capacity being greater than 100,000 MTPA). The company has installed capacity of 103,800 MTPA related to PEB structures and 1,800,000 square metres per annum for Self-Supported Roofing solutions as on March 31, 2025. It has been able to achieve such leadership position by leveraging on its comprehensive suite of services and integrated manufacturing facilities, ability to deliver solutions, strong focus on customer service and its well-established track record of over 9,500 projects undertaken for execution.
It provides a wide range of specialised products and services: As an integrated manufacturing partner providing ‘design-led-manufacturing’ solutions to its customers, it provides designs, engineering solutions, manufacturing and testing to ensure that its structures meet robust standards in reliability, safety and performance. At the core of its operations, it specializes in innovative design, manufacturing and installation of pre-engineered metal buildings, complex structural steel components and self-supported steel roofing. Combining the strengths of its Phenix and Proflex divisions, it has the flexibility to cater to requirements of diverse set of its customers, ranging from small scale projects to large scale projects. It offers solutions to its customers which can range from simple PEB structures as may be required for a warehousing application to complicated constructions as demonstrated by the PEB installation with a retractable (openable) roof structure which it delivered for a Kolkata based shipyard.
Experienced and dedicated promoters and professional management team with domain knowledge: It is led by experienced Promoters in the PEB and structural steel industry and the self-supported steel roofing industry. Its Promoters are actively involved in the critical aspects of its business including business development, engineering, manufacturing operations, quality assurance, marketing and finance. Its organizational structure is designed to support seamless scaling and adaptation to market changes. It has specialized teams for each division of Phenix and Proflex, led by experienced professionals in key areas such as plant operations, quality control, sales and marketing, procurement and finance, which enables it to be well-equipped to respond to evolving industry demands and opportunities. Its Promoters, together with its Key Managerial Personnel, Senior Management Personnel and dynamic Board, with their hands-on management approach ensure that strategic initiatives are effectively implemented across the organization. The depth and breadth of its management teams’ expertise is pivotal in navigating the complexities of its business landscape.
Strategically located manufacturing facilities for PEBs: The company has installed capacity of 103,800 MTPA related to PEB structures and 1,800,000 square metres per annum for Self-Supported Roofing solutions as on March 31, 2025. The cost of transportation of PEB components constitutes a part of the overall pricing of the project. It has two manufacturing facilities at Sanand, Gujarat and Cheyyar, Tamil Nadu for the manufacturing of PEBs and complex structural steel components. Its Sanand Facility is strategically located to cater to the customers in Western India, Northern India and Central India, as well as by close connectivity to ports in the state of Gujarat while its Cheyyar Facility is well placed to cater to the requirements of potential customers in South India. The Sanand and Cheyyar Facilities are equipped with equipment and systems which include high precision CNC machinery, plasma cutting torches, oxy acetylene cutting torches, beam welding machines, online shot blasting and painting systems, sheet profiling machine and integrated purlin forming and painting lines.
Risks and concerns
Majority portion of revenues from design, manufacture and installation of PEB: Its design, manufacture and installation of pre-engineered buildings have been largely driven by its track record of meeting customer specifications, quality standards and its long-term relationship with its customers. It cannot assure that the demand for its pre-engineered buildings will be sustained at the same levels in the future. As a result of any adverse changes in demand by its customers and/or any unfavourable change in government policies which may affect such demand, the revenues derived from its manufacture of PEBs could be lower than its expectations. This could have a material adverse effect on its business, financial condition, results of operations and prospects.
Depends on few customers: It derives a portion of its revenue from operations from few customers and repeat orders from customers groups which it identifies as orders placed by customer groups that have placed orders with the company previously. It has historically been dependent, and expects to depend, on such customers groups and on repeat orders, for a portion of its revenue and the loss of any them for any reason (including due to loss of, or termination of existing arrangements, limitation to meet any change in quality specification, customization requirements, or change in construction technology; disputes with a customer; adverse changes in the financial condition of its customers, such as possible bankruptcy or liquidation or other financial hardship or change in business practices of its customers) could have a material adverse effect on its business, results of operations, financial condition and cash flows.
Dependent on third-party contract labourers: Its operations are dependent on a large pool of contract labour and an inability to access adequate contract labour at reasonable costs may adversely affect its business prospects and results of operations. It enters into arrangements with contractors for the recruitment of contract labour as per its requirements for a fixed period of time. There is no assurance that it may be able to renew these arrangements on a timely basis or at all. It does not have direct control over the timing or quality of the services and supplies provided by such third parties. Contractors hired by the company may be unable to provide the requisite manpower on a timely basis, or at all, or may be subjected to disputes with their personnel, which, in turn, may affect production at its Manufacturing Facilities and timely delivery of its products to its customers. Any disruption to the supply of such labour for its Manufacturing Facilities or customer sites or its inability to control the composition and cost of its contract labour could adversely affect its business, results of operations, financial condition and cash flows.
Stiff competition: Its pre-engineered buildings business and its self-supporting steel roofing business may face competition in its business from both domestic as well as international companies. Few of its competitors may win market share from the company by providing lower cost solutions to its customers, with or without adversely affecting their profit margins or by offering technologically advanced products or services. Even if its offerings address industry and customer needs, its competitors may be more responsive to these needs and more successful at selling their products. If it is unable to provide its customers with superior products and services at competitive prices or successfully market those services to current and prospective customers, it could lose customers, market share or be compelled to reduce its prices, thereby adversely affecting its business, results of operations and financial condition.
Outlook
M&B Engineering is engaged in the business of Pre-Engineered Metal Buildings (PEB), Structural Steel, Self-Supported Steel Roofing and Components thereof. It offers its customers comprehensive turn-key solutions which include project design, engineering, manufacturing and erection in accordance with customer requirements across industrial and infrastructure segments. On the concern side, its business is dependent upon its ability to manage its Manufacturing Facilities, which are subject to various operating risks. Any malfunction or breakdown of its machinery, its equipment, its IT systems or any other part of its manufacturing processes or systems may entail repair and maintenance costs and cause delays in its operations.
The issue has been offering 1,77,65,523 shares in a price band of Rs 366-385 per equity share. The aggregate size of the offer is around Rs 650.22 crore to Rs 683.97 crore based on lower and upper price band respectively. On performance front, the company’s revenue from operations increased by 24.34% from Rs 7,950.60 million in Fiscal 2024 to Rs 9,885.54 million in Fiscal 2025. Moreover, restated profit after tax for the period increased by 68.84% to Rs 770.47 million for Fiscal 2025 from Rs 456.34 million for Fiscal 2024.
Meanwhile, the company intends to explore and consider opportunities that can create synergies between the target companies and it and are in line with its growth strategy. It intends to selectively pursue opportunities that will consolidate its market leadership position, enhance its financial position, expand its existing product and service portfolio and increase its distribution network, customers and geographical reach. Its efforts at diversifying into newer categories of its existing business or into new domestic or international markets may be facilitated by investing in similar business opportunities or making acquisitions of existing brands or businesses with manufacturing facilities, market share or growth potential, whose operations, resources, capabilities and strategies are complementary to its existing business.
