News ArticleSheela Foam Q2 FY27 Revenue Surpasses INR1,000 Crores Despite Raw Material Inflation; Furlenco Joins Group as Growing Subsidiary
Company reports 19% revenue growth to INR1,045 crores for Q2 and over 5x PAT increase, while Furlenco’s furniture rental business shows 34% H1 revenue growth after becoming subsidiary
Sheela Foam Limited reported Q2 FY27 consolidated revenue of INR1,045 crores, marking the first time Q2 revenue crossed INR1,000 crores despite raw material cost surges. The company partially offset input cost inflation through strong brand presence and consumer schemes during a challenging market environment. Furlenco has become a Sheela Foam subsidiary since October 1, 2026, contributing to diversified group growth with 34% H1 revenue growth to INR229 crores and 69% EBITDA increase to INR89 crores.
Sheela Foam Limited
Earnings Call Transcript
Sheela Foam Limited posted a consolidated revenue of INR1,045 crores for Q2 FY27, the first quarter crossing INR1,000 crores, despite unprecedented increases in key raw material costs. The company maintained profitability through strong brand equity and consumer initiatives. From October 1, 2026, Furlenco, a furniture rental firm with accelerating growth and profitability, became a Sheela Foam subsidiary, adding a new dimension to the group’s portfolio.
The period witnessed sharp increases in crude-linked raw materials with polyol prices rising approximately 65% and TDI prices increasing 33% since mid-February, significantly impacting input costs.
Sheela Foam responded by leveraging decades-long supplier relationships to ensure uninterrupted raw material supply, whereas smaller competitors struggled to maintain supplies or prices.
Although the festive season shifted demand from Q2 to Q3, the company launched the 'Great Sleepwell Festival' campaign nationwide, boosting consumer engagement despite pressuring near-term profitability.
Sheela Foam reported consolidated EBITDA of INR87 crores for Q2, comparable to the prior year quarter, and a PAT of INR46 crores, representing a fivefold increase over last year’s corresponding period.
For the first half of FY27, consolidated revenue grew 22% to INR2,077 crores, with operating EBITDA rising 23% to INR200 crores and PAT surging over six times to INR109 crores, maintaining margins amid higher marketing spend to sustain customer demand and brand strength.
Highlights
- Q2 FY27 consolidated revenue reached INR1,045 crores, up 19% year-on-year and first Q2 quarter exceeding INR1,000 crores.
- Operating EBITDA for Q2 remained stable at INR87 crores despite raw material price inflation.
- Profit After Tax (PAT) for Q2 increased fivefold to INR46 crores compared to the prior year.
- H1 FY27 revenue increased 22% to INR2,077 crores, with operating EBITDA of INR200 crores and PAT of INR109 crores.
- Raw material cost inputs like polyol rose 65% and TDI by 33% since mid-February 2026.
- Furlenco became a Sheela Foam subsidiary from October 1, 2026, operating in furniture rentals with 200,000+ subscribers across 30+ cities and 90%+ asset utilization rate.
Key Data Snapshot
What happened
- Sheela Foam crossed INR1,000 crores consolidated revenue in Q2 FY27 for the first time, growing 19% year-over-year.
- Profit after tax for Q2 FY27 was INR46 crores, a fivefold increase compared to the prior year.
- Furlenco, a furniture rental business, became a subsidiary of Sheela Foam Limited effective October 1, 2026.
- Furlenco’s subscriber base exceeds 200,000, with presence in over 30 cities and high asset utilization driving profitability.
Key details
- Raw material prices surged significantly with polyol costs up 65% and TDI costs up 33% since mid-February 2026.
- Supply chain disruptions due to geopolitical events impacted the broader industry and logistics.
- Shift of festive season from late September to October caused demand movement from Q2 to Q3.
- Sheela Foam invested in brand advertising and consumer schemes such as the 'Great Sleepwell Festival' to stimulate demand despite margin pressures.
Financial performance
- Q2 FY27 consolidated revenue: INR1,045 crores, 19% year-over-year growth.
- Q2 FY27 operating EBITDA: INR87 crores, stable compared to previous year.
- Q2 FY27 PAT: INR46 crores, increased approximately five times compared to last year.
- H1 FY27 revenue: INR2,077 crores, up 22% year-over-year.
- H1 FY27 operating EBITDA: INR200 crores, up 23% year-over-year with 9.6% margin.
- H1 FY27 PAT: INR109 crores, more than six times increase compared to previous year.
Strategic context
- Furlenco’s business model centers on furniture rental on a subscription basis, catering to urban and Gen Z consumers valuing flexibility over ownership.
- Since Sheela Foam’s first investment in FY24, Furlenco’s revenue grew from INR139 crores to an expected INR500 crores with EBITDA margin near 40% in three years.
- Integration of Furlenco broadens Sheela Foam’s portfolio beyond mattresses to include furniture rental and retail, foam and cushioning segments.
- Sheela Foam operates a house of more than 13 brands across premium, economy, and luxury mattress segments, expanding with furniture in both rental and retail formats.
Highlights
- Q2 FY27 consolidated revenue reached INR1,045 crores, up 19% year-on-year and first Q2 quarter exceeding INR1,000 crores.
- Operating EBITDA for Q2 remained stable at INR87 crores despite raw material price inflation.
- Profit After Tax (PAT) for Q2 increased fivefold to INR46 crores compared to the prior year.
- H1 FY27 revenue increased 22% to INR2,077 crores, with operating EBITDA of INR200 crores and PAT of INR109 crores.
- Raw material cost inputs like polyol rose 65% and TDI by 33% since mid-February 2026.
- Furlenco became a Sheela Foam subsidiary from October 1, 2026, operating in furniture rentals with 200,000+ subscribers across 30+ cities and 90%+ asset utilization rate.
Disclosures
- Unaudited financial results for quarter and half-year ended September 30, 2026
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