M&B starts Sanand expansion toward 154,000-ton capacity

M&B Engineering Limited began commercial production from Sanand Phase 1 on October 26, 2026, adding 20,000 metric tons of annual pre-engineered building, or PEB, capacity and lifting its total PEB capacity to 124,000 tons. M&B plans further Sanand and Cheyyar projects that management expects to take combined PEB and structural-steel capacity to 154,000 tons by Q3 FY28.

What changed at M&B's Sanand plant?

M&B commissioned Phase 1 of its brownfield expansion at Sanand, Gujarat, effective October 26, 2026. The addition raised the plant's PEB manufacturing capacity by 20,000 tons annually, from 72,000 tons to 92,000 tons, according to management's November 5, 2026 earnings call covering the quarter and half year ended September 30, 2026.

The Sanand start-up increased M&B's aggregate PEB capacity across its Sanand and Cheyyar plants from 104,000 tons annually to 124,000 tons. This was the completed capacity addition disclosed on the call, while the remaining projects in the programme were described as scheduled or under development.

The capacity addition followed a period of higher execution across M&B's Phenix and Proflex divisions. Revenue from operations rose 25.4% year on year to Rs 385 crore in Q2 FY27, the second quarter of financial year 2027, while first-half revenue increased 24.1% to Rs 676 crore.

How will M&B reach 154,000 tons of combined capacity?

M&B plans to reach 154,000 tons of combined PEB and structural-steel capacity through a 10,000-ton annual structural-steel expansion at Sanand and a 20,000-ton annual brownfield expansion at Cheyyar. Management expects the Sanand structural-steel project to start operations in Q1 FY28 and the Cheyyar project in Q3 FY28.

The 10,000-ton Sanand project is expected to increase M&B's structural-steel capacity to 22,000 tons annually. Management said the Cheyyar expansion work had commenced and that its commissioning in Q3 FY28 would result in the stated 154,000-ton combined capacity figure.

The stated timetable puts the Sanand structural-steel start-up ahead of the Cheyyar commissioning by two quarters. These are management's scheduled milestones rather than additions already operating as of the September 30, 2026 half-year end; the call did not provide a detailed capacity bridge for the 154,000-ton combined target.

M&B incurred capital expenditure of Rs 43 crore in Q2 FY27, taking expenditure for H1 FY27 to Rs 70 crore. Separately, it had used Rs 155.27 crore, or 60%, of net initial public offering proceeds of Rs 259.32 crore by September 30, 2026, including Rs 8.58 crore used during Q2.

What demand does M&B have for additional capacity?

M&B's reported order book stood at Rs 1,109 crore at the end of Q2 and H1 FY27, up 19% year on year. Phenix accounted for Rs 874 crore, or 79%, while Proflex represented Rs 235 crore, or 21%, leaving the order book weighted toward Phenix.

Order inflow in Q2 FY27 was Rs 441 crore, up 12% year on year. Phenix booked Rs 335 crore of new orders, including Rs 61 crore of export orders, and Proflex secured Rs 106 crore, providing the divisional composition of quarterly inflow.

M&B also said it had secured a data-centre order and a multi-storeyed-building order after Q2 FY27. Management confirmed that neither order was included in the Rs 1,109 crore order book at September 30, described the data-centre customer as a hyperscaler, and said the high-rise order was of similar size without disclosing either value.

Management linked the data-centre opportunity to an industry projection that India's installed data-centre capacity could reach 6 gigawatts by 2029, driven by artificial intelligence, cloud services and digitisation. That projection was industry context rather than M&B revenue guidance, and management said further details on the two post-quarter orders would be disclosed with the current quarter's results.

How do exports and earnings support M&B's plans?

M&B reported export revenue of Rs 67 crore in Q2 FY27, up 25% year on year, and Rs 95 crore in H1 FY27, up 68%. Domestic revenue was Rs 317 crore in the quarter, representing 83% of revenue, compared with exports' 17% share, while export orders within the Phenix book totalled Rs 272 crore.

For the US market, M&B said its Cheyyar facility had received American Institute of Steel Construction certification and that it was creating a dedicated West Coast sales team. Management intends to supply that region from Cheyyar through the Pacific route from the next financial year, while noting that inquiry-to-order conversion had been slower over the previous five to six months.

Sanand received CE certification from TÜV Nord Systems, which management described as an essential prerequisite for exporting PEB and structural-steel products to the UK and European markets. M&B intends to enter the UK market first and targets commencing business there in FY28, without disclosing an export-revenue target for the region.

Earnings before interest, tax, depreciation and amortisation, or EBITDA, increased 17.6% year on year to Rs 43 crore in Q2 FY27 from Rs 37 crore. Profit after tax rose 32.8% to Rs 29 crore from Rs 22 crore; for H1 FY27, EBITDA was Rs 79 crore against Rs 70 crore and profit after tax was Rs 51 crore against Rs 40 crore.

Conclusion

M&B has completed the first operating stage of its expansion programme, with the October 26, 2026 Sanand commissioning lifting PEB capacity to 124,000 tons annually. The company is adding capacity while reporting Rs 1,109 crore of orders on hand, Rs 385 crore of Q2 FY27 revenue and higher absolute EBITDA and profit after tax.

The next disclosed milestones are the planned Q1 FY28 start-up of the 10,000-ton Sanand structural-steel project and the expected Q3 FY28 commissioning of the 20,000-ton Cheyyar expansion. Management also targets revenue growth of more than 25% in FY27 and plans to begin UK business in FY28, while values and execution timing for the post-quarter data-centre and high-rise orders remain undisclosed.