M & B Engineering Ltd Q4 FY26 Earnings Analysis

- The company expects strong higher-teen growth in FY’27, driven by both Phenix and Proflex divisions. - Current unexecuted export order book stands at approximately INR 280-300 crores, to be executed in FY’27. - Additional capacity of 20,000 tons coming at Sanand plant by Q2 FY’27, and expansion at Cheyyar planned for FY’28. - Proflex capacity to increase by approximately 3 lakh square meters per annum with new manufacturing units commissioning by Q1 FY’27. - Management plans a 3-4 year vision to build PEB capacity to about 3,00,000 tons with 20-25% exports. - Current order pipeline is strong with about 17-18 lakh square meters in Proflex and 100,000 inquiries of 100-150,000 metric tons in Phenix. - Domestic market remains robust with strong inquiries, especially in Southern and Western India. - Railway sector and data center demand are important growth drivers over the next 5 years. - More specific FY’27 guidance to be given at end of Q4 FY’26.

- The company expects strong higher-teen growth in FY27, driven by both Phenix and Proflex divisions. - By end of Q4 FY26, more specific growth and earnings guidance for FY27 will be provided. - Target operating EBITDA margin for FY26 is around 12.75%, with confidence maintained for similar margins (~13%) in FY27. - Q4 is anticipated to be stronger in topline and bottom line compared to Q3. - EBITDA margin expansion of around 1% over the next year is considered realistic, though 2% is ambitious. - The export business is expected to continue robust growth, supporting overall earnings. - Capacity expansions (20,000 tons in Sanand by Q2 FY27 and 28,000 tons in Cheyyar by FY28) will support incremental earnings. - The company is focusing on disciplined execution and profitable growth to drive value creation.

- The company is undertaking a phased capex related to the IPO proceeds, primarily focused on expanding the Sanand plant capacity by 20,000 tons, expected to be operational by Q2 FY'27. - The Cheyyar plant expansion of 28,000 tons per annum will follow, targeted to be operational around Q1 or Q2 FY'28. - Total capex for FY‘27 is estimated at around INR 80 Crores, including expansion phases. - Approximately 50% of the net IPO proceeds (₹130.31 Cr out of ₹259.32 Cr) have been utilized as of Dec 31, 2025. - No plans for additional capital raising like QIP; the company has sufficient borrowing capacity if required. - Evaluating a third plant, likely in Northern India (Lucknow/UP region), to increase overall PEB capacity to ~300,000 tons over next 3-4 years. - Strategic investment includes new manufacturing equipment for Proflex sourced from UAE (commissioned Jan 2026) and two units from the US planned for Q1 FY‘27.

- Currently, M&B Engineering Limited has no plans for any new fundraising through equity (e.g., QIP) or additional capital raising. - The company has enough borrowing capacity if needed but prefers to fund expansions with internal accruals and IPO proceeds. - Ongoing capex is being funded mainly through the unutilized portion of IPO proceeds (~INR 120 crore pending). - The focus is on completing the ongoing Sanand plant expansion and subsequently the Cheyyar plant expansion. - Long-term strategy includes capacity expansions, but no immediate thoughts on raising new capital. - The management explicitly stated that while capex will continue, there is no current plan to raise debt or equity beyond existing arrangements.

- Current domestic order book (Q3): INR 818 crores (includes INR 240 crores Proflex segment; domestic portion approx. INR 500 crores). - Export order book approximately INR 316 crores. - Executable order book pipeline spans next 8-10 months. - Inquiry pipeline: Proflex has about 17 to 18 lakh square meters; Phenix has about 100,000 active inquiries totaling approx. 100,000-150,000 metric tons. - Railways inquiries standing at 5 to 5.5 lakh square meters across 19 zones. - Largest recent export order: INR 212 crores (margins not disclosed). - Overall strong inquiry and order pipeline both domestically and internationally. - Management expects to update more specific guidance by end of Q4 FY26.