M&B Engineering FY26: Record Revenue, Strong Order Book, and a Margin Reality Check

M&B Engineering ended FY26 with its highest ever consolidated revenue, even as the last quarter reminded investors that project execution businesses can face sudden cost shocks. For Q4 FY26, revenue from operations rose to INR 363.70 crore, up 16% year on year. EBITDA was broadly flat at INR 43.15 crore, but the margin dropped to 11.9% from 14.0% in Q4 FY25. PAT came in at INR 27.00 crore, down 5.3% year on year.

For the full year, the company delivered INR 1,259.72 crore in revenue from operations, up 27.4% over FY25. EBITDA increased 16.7% to INR 157.19 crore, while PAT rose 20.2% to INR 92.64 crore. Management described FY26 as a year of strong growth in both domestic and export markets, but acknowledged that profitability came under pressure due to macro headwinds and currency volatility.

A two-division business, with Phenix driving scale and exports rising fast

M&B operates two core divisions. Phenix is the pre-engineered buildings and structural steel business, while Proflex focuses on self-supported steel roofing solutions delivered through mobile manufacturing units. In FY26, Phenix reported revenue of INR 985 crore and Proflex reported revenue of INR 275 crore.

Exports were a key theme through the year. Consolidated export revenue in FY26 was INR 165.62 crore, up sharply versus FY25. Management highlighted that North America remains a priority market, supported by the Sanand facility’s certifications. The investor presentation states that Sanand is India’s only PEB manufacturing unit with certification from the American Institute of Steel Construction and Canadian Welding Bureau registration, which management positioned as important for US and Canadian projects.

Customer repeatability remains a structural positive. The company stated it has served more than 2,000 customer groups and repeat customers contributed 54.07% of FY26 consolidated operating revenue.

Order momentum stayed strong, with a growing export component

Order visibility improved further through FY26. New order inflow for FY26 was INR 1,539 crore, up 28% year on year. As of March 31, 2026, the unexecuted order book stood at INR 1,083 crore, up 35% year on year.

The company disclosed a clear split in the order book between divisions: Proflex accounted for 20% at INR 212 crore, while Phenix accounted for 80% at INR 871 crore. Within Phenix, export orders were INR 279 crore.

Management also highlighted incremental order wins around the year-end. During March 2026, it received a domestic order of about INR 73 crore for design, engineering, and supply of a pre-engineered building, expected to be executed over the next five months. In April 2026, it secured another domestic order of about INR 72 crore with an expected completion timeline of seven and a half months.

Why margins softened, and why management avoided margin guidance

While annual growth remained healthy, the profitability narrative was more complex. In the concall, the CFO attributed margin reduction in Q4 and FY26 to three primary items: forex loss, sharp increases in domestic steel prices, and an increase in export freight costs due to war impact. The company reported net exchange fluctuation losses of INR 3.90 crore in Q4 FY26 and INR 6.04 crore in FY26.

Management also said that, excluding forex losses, adjusted EBITDA margin would be around 13% in both Q4 and FY26. Still, leadership chose not to provide FY27 margin guidance, citing uncertainty in steel pricing, freight volatility, and FX moves.

One structural insight from the call was the margin differential between export and domestic projects. Management stated that at the current cost and pricing structure, export projects were generating about 16% to 17% EBITDA, compared with about 10% to 11% in domestic projects. That mix matters because exports also bring additional costs, including duties and freight, that flow through other expenses.

The cash flow picture also deserves attention. FY26 operating cash flow was negative INR 30.88 crore, driven by working capital changes. Management explained that cash purchases and payments to creditors, supported by long-term funding and IPO proceeds usage, distorted operating cash flow in the reported format.

Capacity expansion and FY27 growth stance

The company continues to invest for scale. FY26 capex was INR 33 crore. For FY27, management indicated estimated capex of around INR 100 crore, including the Sanand expansion, part capex for Cheyyar expansion in the second half, and other regular capex.

Sanand remains central to the near-term capacity plan. Management said it is adding about 20,000 metric tons of capacity at Sanand, expected to be commissioned in Q2 FY27, taking installed capacity to 92,000 MTPA. After that, the company plans to begin expansion at the Cheyyar plant with an aim to make it operational by Q1 or Q2 of FY28.

On Proflex, the company stated it commissioned one new unit in January 2026, and the remaining two new units are expected to be commissioned in Q2 FY27. Once operational, management said Proflex installed capacity would increase by about 200,000 square metres per annum.

For FY27, management expressed confidence of delivering top-line growth of around 25% year on year, supported by the order book and a strong bid pipeline. In the call, the bid pipeline was described as in excess of INR 1,000 crore.

The key investor takeaway is that M&B has built strong revenue momentum and order visibility, with exports becoming increasingly meaningful. But the company is operating in a cost environment where steel, freight, and FX can move quickly. FY27 will test whether the company’s capacity additions and export push can translate into sustained growth while navigating volatility and execution risks.