M&B Engineering Limited: A Strong Player in Pre Engineered Buildings Industry

30 Jul 2025 , 03:14 PM

MBEL is an established player with a growing exports business in pre‑engineered buildings. Its INR 6,500 million IPO comprises both a fresh issue and an offer for sale by its promoters. Proceeds from the fresh issue will be used to strengthen the balance sheet and fund capital expenditures.

Offer Details

Total Offer Size: The total offer size is up to INR 6,500.00 million.

·         Fresh Issue: Up to INR 2,750.00 million

·         Offer for Sale: Up to INR 3,750.00 million.

The Offer for Sale comprises Equity Shares of Promoters – Girishbhai Manibhai Patel, Chirag Hasmukhbhai Patel, Vipinbhai Kantilal Patel, Birva Chirag Patel, Aditya Vipinbhai Patel and Umaben Girishbhai Patel.

Price Band: INR 366 to INR 385 per Equity Share

Book Running Lead Managers:

• Equirus Capital Private Limited
• DAM Capital Advisors Limited

Objectives of the IPO:

The company’s IPO proceeds will be used for multiple purposes, including debt reduction, capital expenditures and general corporate purposes. The specific goals are as follows.

De-leveraging/Repayment of Debt

• Repayment/Payment of principal in full or part of term loans of certain borrowings taken by the company: INR 587.50 million

Capital Expenditures

• Meeting capital expenditure requirements of purchase of equipment and machinery, construction, solar rooftop grid and transport vehicles at the company’s manufacturing facilities: INR 1,305.79 million

Other General Corporate Purposes

• IT software upgradation investment by the company: INR 52 million

Pre-Engineered Buildings – Industry Overview

The pre-engineered buildings market is part of the construction industry, and it is responsible for fabricating buildings in an assembly-line style, where buildings are made from pre-designed constituent parts. Such buildings are intended to be inexpensive, efficient, and environmentally friendly, and are also very popular among end-users. The customers from the industrial, commercial, and residential sectors in the industry use a multitude of products and services, which include pre-engineered buildings, structural steel, and self-supported roofing systems.

The prefab buildings market can be segmented broadly into 3 key categories:

• Industrial Segment
• Infrastructure Segment
• Building Segment

 

Industry Size and Growth Trends

Global Market:

• The global pre-engineered buildings market was valued at USD 20-22 billion in CY2024, compared with USD 15-17 billion in 2019, thereby registering a CAGR of ~7%. The market is expected to clock a CAGR of 9-10% over the medium term and is projected to be valued at USD 32-35 billion by CY2029. This growth could be attributed to rising construction spending, increasing awareness about modern off-site construction techniques, and rising demand for green buildings globally.
• In 2024, the infrastructure segment accounted for the largest share of the global pre-engineered buildings market (40%), followed by buildings (37%) and industrial (23%). Increasing investments in public infrastructure, growing urbanisation and rising awareness of the benefits of pre-engineered construction vis-à-vis the traditional onsite model have contributed to this high share of the infrastructure segment.

Indian Market:

• The industry witnessed a moderately healthy CAGR of ~8.3% over FY19-25, growing from INR 130 billion in 2019 to INR 210 billion in fiscal 2025, driven by increased construction investments and growing awareness of PEB and its advantages.
• Growth is expected to accelerate to a CAGR of 9.5-10.5% between FY25 and FY30 to INR 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).
• Exports of PEB increased to INR 90.5 billion in fiscal 2025 from INR 35.8 billion in fiscal 2019, implying a CAGR of ~17% between fiscals 2019-25.
• As of fiscal 2025, the organised industry held only a 42-47% revenue share in the overall industry, as high capital investment is not required for entering the market. However, the share of the organised industry is expected to improve to 47-52% by FY30.

Key Drivers of Growth

·         Rising Demand from Infrastructure Sector: The government’s strong emphasis on infrastructure development (including roads, railways and urban infrastructure) is a growth driver for PEBs.

·         Increasing Industrialisation: Expansion of the industrial sector, including automobile, cement and oil and gas, among others, is boosting demand for PEBs.

·         Rising Usage of PEBs for Building Applications: PEBs are commonly being adopted in the building sector, considering the benefits they offer in terms of a faster erection process, less wastage of material, and stricter quality control.

·         Government Initiatives: Government initiatives like National Infrastructure Pipeline (NIP), Production Linked Incentive (PLI) scheme, etc, have boosted the growth of the industry.

Company Overview: M&B Engineering Limited

M&B Engineering Limited is a key player in the Pre-Engineered Buildings (PEBs) segment in India. It was founded by a group of entrepreneurs in 1981 to manufacture PVC and uPVC pipes. Over a period of time, the company has evolved and emerged as a major player in the PEB industry.

The company’s original founders have a construction history and have been behind several other previous companies. The company has also partnered with a range of other top companies within the sector to add value whilst broadening its capabilities.

M&B Engineering Limited is engaged in two primary segments: Phenix Division and Proflex Division.

Phenix Division

The Phenix Division offers one-stop solutions to PEB customers, from design to engineering, manufacturing and erection. The division provides various products and services, such as:

·         Main frames

·         Secondary structural components

·         Claddings

·         Accessories

Proflex Division

The Proflex Division offers self-supporting steel roofing, including:

·         Roofing panels

·         Side wall cladding

·         Gable wall cladding

·         Ventilators

·         Skylights

·         HVLS fans

Other Services

M&B Engineering Limited also manufactures products and provides other services such as :

·         Project management

·         Erection and installation

·         Testing and quality control

·         After-sales service

Competitive Landscape

The industry is highly competitive with many established players.

·         Everest Industries Ltd: A pioneer and leader in the Indian building material products business for over 90 years.

·         Interarch Building Products Ltd: A company that has been around for more than 40 years and has been involved in pre-engineered steel construction, with this being its primary business.

·         Kirby Building Systems & Structures India Pvt Ltd: 100% subsidiary of Alghanim Industries of Kuwait, having over 40 years of experience in the PEB domain.

·         Pennar Industries Ltd: A diversified engineering company with a strong presence in the PEB space.

Competitive Positioning

The company has become a key player in the PEB industry, having delivered highly acclaimed products and services. It’s an all-encompassing package of design, engineering, manufacturing, and erection that gives it a competitive edge over its rivals. Its commitment to customer service, quality and innovation has helped it establish a strong name in the industry.

Strengths

Market Leadership: M&B Engineering Limited is amongst the leading Pre-Engineered Buildings (“PEBs”) players in India with an installed capacity of 103,800 MTPA in relation to PEB structures and 1,800,000 square metres per annum for Self-Supported Roofing solutions. It has a dominant market share, which provides economic benefits in the form of a lower cost advantage from scale and better pricing power.

Comprehensive Suite of Services: The firm offers design, engineering, fabrication, and erection on a turnkey basis for industrial and infrastructure projects. This one-stop shop model allows the company to maintain quality, short lead time and cost efficiency.

Weaknesses

Dependence on Raw Materials: A majority of the company’s expenses are raw materials. Any increased costs in input products could have a negative impact on the company’s reputation, business, operating results, financial condition and cash flow.

Limited Suppliers: The company does not have a diversified base of suppliers for its key raw material, steel. The loss of any of these suppliers may adversely impact the company’s business, financial condition and results of operations.

Employee Attrition Rate: The firm’s permanent employee attrition rate was 15.01% in FY25.

Financial Profile

Raw material price volatility led to volatile revenue growth: The company’s revenues fell in FY24 (YoY) while it witnessed a growth in FY25. The volatile growth profile is due to the volatility in raw material prices. In FY25, the company’s revenue growth can be attributed to several factors, including an increase in sales within India and a significant jump in sales outside India. The growth in sales within India can be attributed to higher demand from customers, as indicated by the increase in the company’s order book. The increase in sales outside India can be attributed to higher demand for the company’s products from customers outside India, especially in the United States.

Robust Profit Growth: The company’s profit growth is a result of its efficient operations and its ability to manage costs. The company’s profit after tax has increased significantly over the past few years, driven by an increase in revenue and a decrease in costs. The company’s ability to manage its costs has been a key factor in its profit growth.

Table: Financial Summary

Particulars	FY 23	FY 24	FY 25
Revenue From Operations	8,805	7,951	9,886
YoY		-9.70%	24.34%
PAT	329	456	770
Diluted EPS	6.8	9.2	15.4
YoY		34.46%	68.05%

Source: RHP

 

Peer Comparison Tables

Table: KPI

Particulars	Unit	M & B Building Products Limited	Pennar Industries Limited	Bansal Roofing Products Limited	BirlaNU Limited*	Everest Industries Limited	Interarch Engineering Limited
Revenue from Operations	INR million	9,886	32,266	966	36,152	17,228	14,538
EBITDA	INR million	1,264	3,108	92	586	299	1,362
EBITDA Margin	%	12.78%	9.63%	9.50%	1.62%	1.74%	9.37%
Profit/ (Loss) for the Year	INR million	770	1,195	55	-329	-36	1,078
PAT Margin	%	7.73%	3.66%	5.72%	-0.90%	-0.21%	7.31%
Return on Equity	%	25.13%	11.95%	16.71%	-2.72%	-0.60%	14.35%
Return on Capital Employed	%	24.80%	0.16	20.61%	-2.97%	0.74%	18.88%
Net Debt	INR million	1,013	5,856	48	6,292	1,532	-1,816
Net Debt to EBITDA	times	0.8	1.88	0.52	10.74	5.12	-1.33
Net Debt to Equity	times	0.33	0.59	0.14	0.52	0.26	-0.24
Net Fixed Assets Turnover Ratio	times	5.56	3.31	3.33	2.1	3	6.36
Net Working Capital	INR million	2,881	6,383	130	4,546	4,237	2,560
Net Working Capital Days	No of days	106	72	49	46	90	64
Installed Capacity	MTPA	103800	NA	NA	NA	NA	161000
Installed Capacity for self-roofing systems	Square meters	1800000	NA	NA	NA	NA	NA
Number of manufacturing facilities	In Number	2	13	NA	32	2	5

Source: RHP

Table: Financials

Name of the company	Revenue from operations 2025 (INR million)	Diluted EPS 2025 (INR)	P/E as on July 7, 2025	RONW (%)	NAV (₹)
M & B Engineering Limited	9,886	15	24.98*	25.14	61.31
Pennar Industries Limited	32,266	9	25	11.96	73.99
Bansal Roofing Products Limited	966	4	28	16.71	25.13
BirlaNU Limited*	36,152	-44	NM	-2.72	1606.51
Everest Industries Limited	17,228	-2	NM	-0.6	377.13
Interarch Building Products Limited	14,538	68	34	14.35	451.56

Source: RHP, * upper end of price band