Sheela Foam Q4 Review - The Template Is Intact; Revenues Up, Margins Down: ICICI Securities

Coloured foam filling for furniture. (Photographer: Balint Porneczi/Bloomberg).

Sheela Foam Q4 Review - The Template Is Intact; Revenues Up, Margins Down: ICICI Securities

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

A good revenue performance (up 9% like-for-like two-year compound annual growth rate) was (somewhat) dampened by 51-78% YoY inflation in key raw materials (Toluene di-isocyanate, polyurethane); gross margin contracted to lowest-ever level of 37.4%.

The template of new consumer recruitment continues - something which we like - manifested by higher growth in lower-end products (our view).

Growth in foam cores and technical foam was impressive at 17-19% (two-year CAGR).

As expected, Australia recovered smartly (two-year CAGR growth of 13%) and Spain also did well.

Click on the attachment to read the full report:

ICICI Securities Sheela Foam Q4FY21 Results Update.pdf

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