Sheela Foam (SFL) Q3 25/26 earnings summary

Executive summary

• Completed Kurl-on merger and integration, driving operational turnaround and synergy realization.

• Consolidated revenue grew 7% YoY to INR 2,771 crore for 9M FY26, with core EBITDA margin at 10.6% and Q3 margin at 10.9%.

• Mattress volumes grew 11% YoY for 9M FY26; foam volumes up 12% YoY.

• E-commerce revenue surged 53% YoY to INR 180 crore over 9 months; H1 FY26 e-commerce sales up 138%.

• Furlenco investment progressing, with annualized revenue run rate at INR 400 crore and PAT of INR 18 crore for 9 months.

Financial highlights

• Standalone revenue for 9M FY26 increased 6% YoY to INR 2,143 crore; consolidated revenue for Q3 FY26 was INR 1,074.43 crore.

• Core EBITDA margin expanded to 10.9% in Q3 FY26, with Q3 EBITDA at INR 117 crore.

• Consolidated PAT for Q3 FY26 at INR 52.57 crore, tripling YoY; 9M PAT at INR 69 crore.

• Cash PAT for 9 months at INR 209 crore; cash EPS approx. INR 19/share.

• Gross margin (consolidated) at 43.5% for 9M FY26; standalone operating margin at 37.0%.

Outlook and guidance

• Targeting 15% revenue growth and 15% EBITDA margin for India business over the medium term.

• Margin improvement expected to continue, with 14-15% EBITDA margin anticipated by FY 2028.

• Targeting ~700 new showrooms in FY26, with 607 already launched in 9M FY26.

• Price increases of 4-5% implemented in Q3, with full impact expected in Q4.

• Management is evaluating the impact of new Indian labour codes, but expects no material effect.