This article first appeared on GuruFocus .
Release Date: May 15, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Welspun Living Ltd ( BOM:514162 ) reported a 7.7% sequential revenue growth in Q4 FY26, indicating a positive trend.
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The company achieved a significant improvement in EBITDA margin, reaching 10.8% in Q4, up 313 basis points from the previous quarter.
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Net debt was reduced by 52% year-on-year to INR 775 crores, showcasing strong financial management.
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The company's branded business showed strong growth, with Welspun and Spaces brands growing 44% and 19% year-on-year, respectively.
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Welspun Living Ltd ( BOM:514162 ) commenced commercial production at a new Nevada Greenfield Pillow facility, enhancing its manufacturing capabilities in the U.S.
Negative Points
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FY26 consolidated revenues declined by 11.5% year-on-year, reflecting challenges in the operating environment.
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The home textile business was impacted by cautious retail buying and tariff uncertainty, leading to an 11.2% revenue decline.
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Advanced textiles business saw a 20% year-on-year revenue decline due to volume pressure and slower export offtake.
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Global soaring business experienced a 25.1% year-on-year revenue decline, affected by logistics disruptions and tariff headwinds.
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The company faces ongoing challenges with rising raw material costs, including a 10% increase in cotton prices and a 40% increase in crude prices.
Q & A Highlights
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Q: What is the current situation regarding tariffs, and how will it affect utilization levels for FY27? A: (CEO) The tariff situation has evolved from 10% to 50% and back to 10%. Conversations about tariff refunds are ongoing. Utilization levels are expected to improve, with towels, sheets, and bath rugs utilization projected to be above 86% as we move forward. Despite tariff challenges, we maintained customer relationships and strategic partnerships.
Q: How will rising cotton prices impact margins, and are there any price hikes from customers? A: (CEO) Cotton prices have increased by 10%, man-made fibers by 20%, and crude by 40%. We are implementing cost controls and discussing price adjustments with customers. Conversations are ongoing to share the cost burden where necessary.
Q: What is the outlook for the flooring business, and how do FTAs impact this segment? A: (CEO) Soft flooring has positive margin potential and is expected to grow by 30%. FTAs with regions like Australia, New Zealand, and Europe will open up significant opportunities, especially in the commercial and hospitality sectors.
Q: How is inflation in the US affecting retail demand, and what gives confidence in utilization levels? A: (CEO) Despite inflation, US retail demand remains robust. Our non-US markets contribute 41% of our top-line, and upcoming FTAs with the UK and Europe will further support growth. The US remains a significant consumption economy, and we expect growth compared to last year.
Q: What are the medium-term revenue aspirations, and which segments will drive growth? A: (CEO) We aim to achieve INR 15,000 crores in the next three years, with current capacities supporting up to INR 12,000 crores. Growth will be driven by our leadership in the bath category, sleep solutions, and branded businesses. India is also a key growth market, with significant potential in brands like Wellhome and Christie.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
