This article first appeared on GuruFocus .
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Sales Volume:25.2 million meters in Q2 FY26, up 7% from 23.6 million meters in Q1 FY26.
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Total Income:INR 1,882 crores in Q2 FY26, a 12% increase from INR 967 crores in Q1 FY26.
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EBITDA:INR 123 crores in Q2 FY26, up 3% from INR 119 crores in Q1 FY26.
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EBITDA Margin:11.4% in Q2 FY26, down from 12.3% in Q1 FY26.
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PAT (Profit After Tax):INR 39 crores in Q2 FY26, similar to INR 38 crores in Q1 FY26.
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EPS (Earnings Per Share):INR 1.97 per share for Q2 FY26.
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Net Debt Reduction:INR 175 crores reduction in H1 FY26.
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Net Debt-to-Equity Ratio:0.34 times as of September 2025.
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Release Date: November 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Indo Count Industries Ltd ( BOM:521016 ) signed a licensing agreement with the globally recognized Tommy Hilfiger brand, marking its sixth licensed brand.
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The relaunch of Wamsutta in the US has seen encouraging traction, with products sold in all 50 states, reflecting strong brand recall.
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The company maintained approximately 60% capacity utilization across its US manufacturing facilities despite challenging conditions.
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Indo Count Industries Ltd ( BOM:521016 ) achieved a quarter-on-quarter revenue growth of 12% in Q2 FY26, driven by higher contributions from new businesses and volume growth in core business.
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The company reduced its debt by INR175 crores in H1 FY26, with a net debt-to-equity ratio of 0.34 times as of September 2025.
Negative Points
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The 50% tariff imposed on India has impacted Indo Count Industries Ltd ( BOM:521016 )'s export competitiveness in the US market.
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Margins have been temporarily affected due to strategic decisions to partner with customers amidst tariff challenges.
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EBITDA margin for Q2 FY26 decreased to 11.4% from 12.3% in the previous quarter, with margin pressure expected to continue until the end of the year.
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The company's third manufacturing facility in North Carolina faced a delay and is now expected to become operational in late Q3 FY26 or early Q4 FY26.
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The full impact of the tariff is just setting in, which may affect margins further in the second half of FY26.
Q & A Highlights
Q: What is the current cotton mix for Indo Count Industries, and is there any news on the extension of duty-free cotton imports? A: Approximately 30-35% of cotton is imported. Most imported cotton is 32 millimeters in length and above, which is duty-free. Cotton below 32 millimeters is duty-free until December 31, 2025. There is no news yet on the extension, but it is expected to continue.
Q: How is the tariff impact affecting Indo Count's volumes and margins, and are these numbers sustainable if the 50% tariff persists? A: The volume increase from Q1 to Q2 is across all markets, including the US. The full tariff impact is just setting in, and margins are expected to be impacted in H2. The sustainability of these numbers depends on future recalibration of prices and retail adjustments.
Q: What is the total CapEx for FY26, and are there any plans for FY27? A: The total CapEx for FY26 is approximately INR200 crores, with INR100 crores allocated for the North Carolina greenfield project. Around INR80-85 crores have been spent so far. For FY27, only maintenance CapEx is planned, with some spillover from FY26 projects.
Q: How is the demand in the US market, and what is the outlook for utilization levels in the second half of the year? A: Retailers are adjusting to the new tariff levels, and the situation is fluid. The third quarter is expected to have similar volumes to the second quarter. The full impact of retail price increases is yet to be seen, and future demand will depend on consumer reactions.
Q: How is the brand business expected to grow, and what are the revenue targets for the US and Indian markets? A: Indo Count aims for $275 million in revenue from the utility bedding and brand business by 2028, with $175 million from utility bedding and $100 million from brands. The brand portfolio is expanding, and the company is on track to achieve its targets, with a current run rate of $85 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
