Sheela Foam shares rallied 17.7% following the company's impressive Q4 FY26 earnings announcement. According to reports from Business Standard, the stock surge reflects investor confidence in the company's strong operational performance and margin expansion across its key business segments. The company's shares jumped 14.94% to ₹625.00 in pre-market trading on May 15, 2026, marking a significant turnaround after nine consecutive quarters of negative results.
The company delivered a remarkable 601% year-on-year jump in net profit to ₹912 crore in Q4 FY26, significantly higher than the previously reported ₹92 crore figure. Revenue from operations grew 23.5% year-on-year to ₹10.5 billion, marking a significant milestone as the company breached the ₹10 billion quarterly revenue mark. As reported by Business Standard, this represents a substantial improvement from the previous quarter's ₹53 crore profit and demonstrates the company's successful navigation of raw material price fluctuations and market dynamics. The board's recommendation of a 20% dividend further boosted shareholder confidence, with the company achieving its highest-ever turnover and EBITDA in its history.
EBITDA margins expanded dramatically by 723 basis points to 11.11% from 3.88% in the previous year, indicating improved operational efficiency and cost management. EBITDA grew by 251.5% year-on-year to ₹1.16 billion, showing massive operating leverage as the company scaled its operations. According to Business Standard, core EBITDA margin improved 400 basis points year-on-year to 11.5% from 7.5% in Q4 FY25, with sequential expansion of 60 basis points from 10.9% in Q3 FY26. The margin expansion reflects successful raw material sourcing strategies, scale efficiencies, and the consolidation of Kurlon assets contributing to high margin expansion.
The company demonstrated robust demand across its product portfolio, with mattress volumes growing 13% in Q4 FY26 and the foam segment registering 34% growth. As reported by Business Standard, for the full fiscal year FY26, mattress volumes rose 12% while the foam segment achieved 18% growth. The strong volume performance contributed significantly to the company's revenue growth and margin expansion throughout the year, with the 23.5% revenue growth indicating strong traction across both the Sleepwell and Kurlon brands.
For FY26, revenue from operations increased 11.11% year-on-year to ₹3,821 crore from ₹3,439 crore in FY25. According to Business Standard, core EBITDA rose 46.29% to ₹414 crore from ₹283 crore, while profit after tax increased 78.89% to ₹161 crore from ₹90 crore in FY25. Core EBITDA margin expanded 260 basis points to 10.8% in FY26 from 8.2% in FY25, reflecting the company's successful integration of the Kurlon acquisition and operational improvements across its mattress and foam segments. The company has pivoted from an acquisition-heavy phase to a high-efficiency phase, with recent focus on optimizing manufacturing footprint across 10+ facilities to reduce logistics costs.
The company's board recommended a final dividend of ₹1 per equity share with a face value of ₹5 each for FY26, to be paid within 30 days from shareholder approval. Chairman and Managing Director Rahul Gautam stated that FY26 marked the realization of benefits from the Kurlon acquisition integration, with both Sleepwell and Kurlon brands delivering strong growth. As reported by Business Standard, Gautam highlighted that the company achieved its highest-ever turnover and EBITDA in its history, reflecting the strength of its integrated platform and continued commitment to profitable growth. However, Sheela Foam's current P/E ratio is around 65-70x, significantly higher than its 10-year average of 52.58 and the industry average of about 33.16 for Household & Personal Products, suggesting premium valuation despite strong fundamentals.
