Yes, in theory it would be fine because its a wet mash when you feed it, so no dust.
However, unless the horse has very severe rao or there are other reasons why it cannot eat hay at all (such as teeth) it isnt perfect because long fibre (e.g. hay) is good for both the digestive system and mental health. i.e. it has other benefits than just a source of food.
It would also work out much more expensive to feed as a total replacer for a horse that could still eat soaked hay/haylage. You have to feed by dry weight, so although it swells when soaked and looks like a large volume you have to work out the kg of dry feed. This could be 12.5kg day of total food for a 500kg horse. In the winter with limited grass you would need 3-4 sacks a week if fed at 10kg a day, with the rest as hard feed.
If you have no choice and the horse cant eat hay then you obviously have to put up with the cost!
