M&B Engineering Ltd IPO: A Comprehensive Analysis for Investors
M&B Engineering Ltd, a Gujarat-based leader in Pre-Engineered Buildings (PEB) and self-supported steel roofing solutions, is set to launch its ₹650 crore IPO on July 30, 2025. This IPO marks a significant opportunity for investors to tap into India’s booming infrastructure and industrial construction sectors. With a strong market position, robust financial growth, and a clear growth strategy, M&B Engineering is poised to attract both retail and institutional investors. Here’s an in-depth analysis of the IPO, covering key details, financials, strengths, risks, peer comparison, and investment recommendations.
IPO Snapshot: Key Details
- IPO Dates: Opens July 30, 2025, closes August 1, 2025
- Listing Date: August 6, 2025 on BSE and NSE
- Price Band: ₹366–₹385 per share
- Lot Size: 38 shares (minimum investment: ₹13,908 for retail investors)
- Issue Size: ₹650 crores (Fresh Issue: ₹275 crores, Offer for Sale: ₹375 crores)
- Selling Shareholders: Promoters including Girishbhai M. Patel (₹153.35 crores), Chirag H. Patel (₹130.25 crores), Birva C. Patel (₹38.50 crores), Vipinbhai K. Patel (₹18.75 crores), Aditya V. Patel (₹18.75 crores), and Umaben G. Patel (₹15.40 crores)
- Anchor Investors: Raised ₹292 crores from institutions like HDFC Mutual Fund, Kotak MF, and Abu Dhabi Investment Authority (59% allocated to 7 domestic mutual funds)
- Allocation: 75% for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), 10% for Retail Investors, with an employee reservation of ₹2 crores
- Lead Managers: Equirus Capital Private Limited, DAM Capital Advisors Limited
- Registrar: MUFG Intime India Private Limited (Link Intime)
The IPO comprises a fresh issue to fund growth initiatives and an Offer for Sale (OFS) allowing promoters to monetize their stakes, driven by SEBI regulations and strategic divestment goals.
What Does M&B Engineering Do?
Founded in 1981, M&B Engineering is a key player in India’s PEB and self-supported steel roofing markets, operating through two divisions:
- Phenix Division: Focuses on end-to-end PEB solutions, including design, engineering, manufacturing, and installation. It has delivered 1,600+ projects across 22 countries, supplying 640,000 MT of steel over 15 years.
- Proflex Division: Specializes in self-supported steel roofing, holding a 75% market share in India (FY24, per CRISIL). It has completed 7,900+ projects, covering 18.5 million square meters, using 14 mobile manufacturing units for on-site installation.
The company serves diverse industries, including automotive (17.25%), food & beverages (17.06%), manufacturing, warehousing, power, textiles, and railways, with marquee clients like Adani Group, Tata Advanced Systems, Intas Pharmaceuticals, and Haldiram Foods.
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Manufacturing Capabilities
- Sanand, Gujarat: Primary PEB facility since 2008, India’s only PEB plant certified by the American Institute of Steel Construction.
- Cheyyar, Tamil Nadu: Operational since 2024, enhancing South India market access.
- Capacities: 103,800 MTPA for PEB and 1.8 million square meters per annum for roofing.
Financial Performance: Robust Growth
M&B Engineering has shown consistent financial improvement:
- Revenue: Grew from ₹688 crores (FY22) to ₹989 crores (FY25), a 44% increase (24.3% YoY in FY25 from ₹795 crores in FY24).
- Net Profit: Surged from ₹16.31 crores (FY22) to ₹77.04 crores (FY25), a 372% increase (68.8% YoY in FY25).
- EBITDA: Rose from ₹41.84 crores (6.08% margin) in FY22 to ₹134.78 crores (13.63% margin) in FY25.
- Key Ratios (FY25):
- PAT Margin: 7.79% (up from 2.37% in FY22)
- Return on Equity (RoE): 25.13% (up from 11.24%)
- Return on Capital Employed (RoCE): 25.13% (up from 17.13%)
- Earnings Per Share (EPS): ₹15.41 (up from ₹4.01)
- Debt-to-Equity: 0.61, reflecting a balanced capital structure.
- Working Capital Days: 123 days, indicating capital-intensive operations.
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Comparison With Industry Peers
M&B Engineering operates in the competitive Pre-Engineered Buildings (PEB) and self-supported steel roofing sectors, where it stands out due to its market leadership and operational scale. Below is a comparison with key listed peers based on FY25 financials and market positioning:
| Metric | M&B Engineering | Interarch Building Products | Pennar Industries | Bansal Roofing Products | Everest Industries |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 989 | 1,400 | 3,115 | 118 | 1,650 |
| Net Profit (₹ Cr) | 77.04 | 86.45 | 80.24 | 8.61 | 20.72 |
| EBITDA Margin (%) | 13.63 | 9.80 | 8.31 | 10.92 | 4.43 |
| PAT Margin (%) | 7.79 | 6.18 | 2.57 | 7.29 | 1.26 |
| RoE (%) | 25.13 | 17.80 | 10.76 | 13.90 | 3.23 |
| P/E Ratio (x) | 28.55 | 35.40 | 25.23 | 28.39 | 64.92 |
| Market Cap (₹ Cr) | 2,200 | 3,400 | 2,984 | 185 | 1,346 |
| PEB Capacity (MTPA) | 103,800 | 141,000 | 180,000 | N/A | 72,000 |
| Market Focus | PEB & Roofing | PEB & Structural Steel | PEB & Steel Products | Roofing Solutions | PEB & Roofing |
| Export Presence | 22 countries | 10+ countries | 10+ countries | Limited | Limited |
Analysis:
- Revenue and Profitability: M&B’s revenue (₹989 Cr) is lower than Interarch (₹1,400 Cr) and Pennar (₹3,115 Cr) but significantly higher than Bansal (₹118 Cr). Its EBITDA margin (13.63%) and PAT margin (7.79%) are superior to most peers, reflecting operational efficiency.
- Valuation: M&B’s P/E ratio (28.55x) is below the industry average (29.11x) and Interarch (35.4x), indicating a relatively attractive valuation. Pennar (25.23x) is slightly cheaper, while Everest (64.92x) is notably expensive due to lower profitability.
- Market Position: M&B leads in self-supported roofing with a 75% market share in India (CRISIL, FY24) and is among the top PEB players by capacity (103,800 MTPA). Interarch and Pennar have larger PEB capacities, but M&B’s focus on roofing and exports (22 countries) gives it a competitive edge.
- RoE: M&B’s 25.13% RoE outperforms all peers, signaling efficient capital utilization.
- Peer Strengths: Interarch is a leader in turnkey PEB solutions with a broader domestic footprint. Pennar diversifies across steel products, reducing PEB dependency. Bansal focuses solely on roofing, limiting its scale. Everest, despite a strong brand, lags in profitability.
M&B’s AISC certification for its Sanand facility and diversified revenue (PEB: 77.35%, roofing: 22.65%) position it favorably against peers, especially in export markets. Its valuation appears undervalued compared to Interarch and Everest, making it an attractive investment.
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Market Position and Competitive Edge
Industry Leadership
- Self-Supported Roofing: 75% market share in India (FY24).
- PEB Market: Among top players by installed capacity, with a growing international presence.
- Export Reach: Operations in 22 countries, bolstered by a U.S. subsidiary in Texas.
Competitive Strengths
- End-to-End Solutions: Offers comprehensive services from design to installation, enhancing customer convenience.
- Strong Order Book: ₹842.84 crores as of June 2025, ensuring revenue visibility.
- Customer Loyalty: 57% of FY25 revenue from repeat customers, reflecting trust and reliability.
- Diverse Clientele: Serves 2,000+ customers across multiple sectors, reducing sector-specific risk.
Industry Outlook
India’s PEB market grew at an 8% CAGR (FY19–FY24) to ₹195 billion and is projected to reach ₹315–330 billion by FY29 (10–11% CAGR). Demand is driven by:
- Infrastructure Push: Government initiatives like industrial corridors and smart cities.
- E-commerce Growth: Rising need for warehousing solutions.
- Industrial Recovery: Increasing capex in manufacturing and logistics.
IPO Structure and Valuation
Fund Utilization
Fresh issue proceeds (₹275 crores) will be used for:
- Capital Expenditure: ₹130.58 crores for equipment, machinery, solar rooftop grid, and transport vehicles (47.27%).
- Debt Repayment: ₹58.75 crores (21.36%) to reduce borrowings (₹186.1 crores as of May 2025).
- IT Upgrades: ₹5.2 crores (1.89%) for software enhancements.
- General Corporate Purposes: Remaining funds.
Valuation Metrics
At ₹385 (upper band):
- Market Cap: ₹2,200 crores
- Post-IPO P/E Ratio: 28.55x (pre-IPO: 24.98x)
- Price-to-Book Value: 6.28x
- Industry P/E Average: 29.11x (peers: Pennar Industries 25.23x, Interarch Building Products 35.69x, Bansal Roofing Products 28.39x).
The IPO is fairly priced, with a P/E ratio below the industry average, suggesting undervaluation compared to peers like Interarch.
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Grey Market Premium (GMP)
As of July 29, 2025, GMP ranges from ₹36–₹55, indicating an estimated listing price of ₹421–₹440 (9–14% listing gain).
Risks to Consider
- Manufacturing Dependency: Operations rely on two facilities (Sanand and Cheyyar), vulnerable to disruptions like equipment failure or labor issues.
- Sector Concentration: 77.35% of FY25 revenue from PEB activities, exposing the company to construction and infrastructure cycles.
- Customer Concentration: 54.89% of FY25 revenue from top 10 customers, creating dependency risk.
- Order Cancellations: 24.28% of FY24 revenue lost to cancellations, impacting profitability.
- Raw Material Volatility: Steel price fluctuations could squeeze margins.
- Working Capital Needs: High working capital days (123) lead to cash flow volatility.
Management and Governance
Promoters
Led by the Patel family:
- Girishbhai M. Patel: Founder, 40+ years of experience.
- Chirag H. Patel: Managing Director, engineering expertise.
- Malav G. Patel: Joint Managing Director, driving innovation.
- Vipinbhai K. Patel: Financial and administrative oversight.
Governance
The company maintains professional governance with independent directors and board committees. Post-IPO, promoters will retain majority control while expanding the investor base.
Should You Subscribe?
Why Invest?
- Market Leadership: Dominant in self-supported roofing (75% share) and a top PEB player.
- Financial Growth: 44% revenue and 372% profit growth (FY22–FY25).
- Export Potential: Presence in 22 countries with AISC certification.
- Fair Valuation: P/E of 28.55x vs. industry average of 29.11x.
- Strong Anchor Interest: ₹292 crores raised from reputed institutions.
Risks to Weigh
- Cyclical Exposure: Vulnerability to infrastructure and construction downturns.
- Customer Dependency: Reliance on top clients for significant revenue.
- Operational Risks: Manufacturing and working capital challenges.
Recommendation: SUBSCRIBE
The M&B Engineering IPO is a compelling opportunity for long-term investors seeking exposure to India’s infrastructure growth. Its market leadership, financial strength, and reasonable valuation make it attractive, despite cyclical and operational risks. The 10% retail quota and potential 9–14% listing gains (based on GMP) add short-term appeal. Investors with a 3–5-year horizon and moderate risk appetite should consider subscribing.
How to Apply
- Log into your bank or broker account (e.g., Zerodha, Upstox, Groww).
- Select M&B Engineering IPO in the IPO section.
- Enter lot quantity (minimum 1 lot = 38 shares) and price (₹366–₹385 or cut-off).
- Use UPI or ASBA for payment.
- Check allotment status on August 4, 2025, on Link Intime and kfintech websites.
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Final Thoughts
M&B Engineering’s IPO offers a gateway to India’s growing PEB and roofing markets, backed by strong fundamentals and a diversified client base. While risks like sector cyclicality and customer concentration exist, the company’s leadership, export potential, and fair pricing make it a solid pick for long-term wealth creation. Apply early, consider multiple demat accounts to boost allotment chances, and consult a financial advisor to align with your investment goals.
FAQs (Frequently Asked Questions)
- What is the issue size and price band of the M&B Engineering IPO?
The M&B Engineering IPO has a total issue size of ₹650 crores, with a price band set between ₹366 and ₹385 per share. - What are the main business divisions of M&B Engineering Ltd?
M&B Engineering operates through two main divisions: the Phenix Division, specializing in Pre-Engineered Buildings (PEB), and the Proflex Division, focused on self-supported steel roofing systems. - How has M&B Engineering’s financial performance been recently?
From FY22 to FY25, M&B Engineering’s revenue grew by 44% to ₹989 crores, and its net profit surged by 372% to ₹77.04 crores, demonstrating strong financial health and growth. - What is M&B Engineering’s market share in self-supported steel roofing?
As of Fiscal 2024, M&B Engineering holds a dominant 75% market share in India’s self-supported steel roofing solutions segment. - What are the key risks for M&B Engineering investors?
Key risks include dependency on its manufacturing facilities, sector concentration in PEB, customer concentration, order cancellation risk, working capital intensity, and raw material price volatility. - What is the valuation of M&B Engineering at the IPO price?
At the upper price band of ₹385, M&B Engineering’s post-IPO PE ratio is 28.55x based on FY25 earnings, which appears reasonable compared to industry peers. - How will the IPO proceeds be utilized by M&B Engineering?
The fresh issue proceeds (₹275 crores) will be used for capital expenditure (₹130.57 crores), debt repayment (₹58.75 crores), IT software upgrades (₹5.2 crores), and general corporate purposes.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always consult with a professional advisor before investing.
