Broker’s call: Man Industries (Buy)

Target: ₹480

CMP: ₹403.15

Man Industries (MAN) board has approved raising up to ₹300 crore via issue of 9.15 million convertible warrants on a preferential basis to promoters (1.22 million) and an other cohort of non promoter allottees (7.93 million) at a price of ₹328/share. The list of proposed non promoter allottees includes reputed institutional and individual investors.

The proceeds from this issue are expected to be received in 2 tranches: 25 per cent at the time of allotment and the rest 75 per cent at the time of conversion to equity shares within 18 months from the date of allotment. This will result in a dilution of 12 per cent after the entire transaction. Last week, MAN also issued equity shares of 2.5 million upon conversion of warrants that were issued in Dec 2023, at an issue price of ₹183.50. Total amount received from this transaction is ₹45.90 crore.

We arrive at a 1 year forward TP of ₹480/share (₹450/share earlier) for MAN. We now value MAN on our EV/CE framework where we assign an EV/CE multiple of 1.35/ 1.35x for FY27E/28E, which we believe is conservative given strong ROCE even under reasonable operational assumptions.

Slow down in conversion of bid pipeline into order book and slow ramp up of upcoming capacities are risks to our Buy rating

Published on June 2, 2025