Buy Man Industries; target of Rs 600: Choice Institutional Equities

Choice Institutional Equities's report on Man Industries

We reiterate our BUY rating on Man Industries Ltd. (MAN) with a revised target price of INR 600/share (earlier INR 480/share). Our positive stance is underpinned by the following key drivers: 1) Capacity-led growth visibility: Ramp-up of the upcoming 20 KT stainless steel pipes facility in Jammu (project cost: INR 5.9Bn) and the 300 KT H-SAW pipes plant in Saudi Arabia (project cost: INR 6.3Bn) is expected to meaningfully augment revenues from FY27E. 2) Strong earnings trajectory: We build in Revenue/EBITDA/PAT CAGR of 30/59/73% over FY25–28E, supported by an order book of INR 47.5Bn and a healthy bid pipeline of INR 150Bn, providing multi-year visibility.

Outlook

Our valuation approach provides the flexibility to calibrate the multiple based on an objective and quantifiable assessment of the company’s forward financial performance. As a sanity check, we cross-validated our EV/CE-derived TP with implied trading multiple. At our TP of INR 600/share, the implied FY28E valuation translates to EVEBITDA/PB/PE 3.9/1.3/5.7x. This implied multiple reinforces the conservatism embedded in our valuation and support our positive view on MAN.