Sarva Foam Industries Limited IPO

01At a glance

What the company does: makes rebonded polyurethane (PU) foam, binding foam trims and off-cuts with chemical binders into sheets for mattresses and furniture, blocks for industrial conversion and rolls of carpet underlay, at Silvassa, Dadri and two units at Krishnagiri, with 15,500 MTPA of installed capacity at March 2026; about a third of revenue is trading in foam trims, binders and finished foam (DRHP p.223, DRHP p.242).

Who pays it: mattress, furniture and flooring makers in India, and from FY26 carpet underlay customers in the United Kingdom and Australia. The FY26 top ten, 81.00% of revenue, include Sheela Foam Limited, Duroflex Limited, Infinity Flooring, Shrivaarna Technofoams Private Limited and Repose Mattress Private Limited; the other five are not named for want of consent (DRHP p.30).

Why it is raising money: ₹900.00 million towards a new rebonded foam plant at Acharpura Textile Park, Bhopal, and ₹300.00 million to repay or prepay borrowings, plus general corporate purposes capped at 25% of the gross proceeds (DRHP p.122). The 1,350,000 shares in the offer for sale are sold by the promoter, Kunal Giani, and the money goes to that shareholder, not the company (DRHP p.121).

How fast it has grown: revenue from ₹1,320.36 million in FY24 to ₹2,061.21 million in FY26, about 24.9% a year, and profit after tax attributable to owners from ₹69.02 million to ₹176.53 million, about 59.9% a year (our arithmetic, DRHP p.83).

The one thing to understand: FY26 growth came from exports that began in April 2025. Revenue from outside India was ₹715.35 million, 34.71% of FY26 revenue, ₹604.15 million of it from the United Kingdom, while revenue from within India fell from ₹1,747.29 million in FY25 to ₹1,336.56 million in FY26 (DRHP p.34, DRHP p.35).

02The business, in plain words

Foam makers and mattress factories cut large blocks of polyurethane foam to size and are left with trims and off-cuts. This company collects those scraps, shreds them, mixes them with a PU binder, which works as an adhesive, and presses and steams the mix into dense blocks that are peeled into sheets or rolled into carpet underlay (DRHP p.223, DRHP p.236). Many of its customers are also its suppliers: the FY26 top ten suppliers include Sheela Foam Limited, Duroflex Limited and Shrivaarna Technofoams Private Limited, the same names that appear among its top ten customers (DRHP p.31, DRHP p.30).

A mattress or flooring maker needs dense, low-cost foam → the company buys foam trims and binders from foam makers and traders → it shreds, binds, moulds, peels and cuts them into sheets, blocks and underlay rolls at four plants → it is paid per order, on credit of 7 to 120 days.

The plants are at Silvassa (5,000 MTPA), Dadri (5,000 MTPA), Krishnagiri Unit I (3,100 MTPA) and Krishnagiri Unit II (2,400 MTPA); a Hyderabad unit was wound up from October 2024 (DRHP p.242, DRHP p.243). Credit terms run from 7 to 120 days (DRHP p.36). In India it supplies customers directly; in the United Kingdom it sells mainly through sales agents, and trades carpet underlay accessories through a step-down subsidiary, Sarva Foam UK Ltd (DRHP p.224, DRHP p.223).

Alongside manufacturing it trades: in FY26 it resold ₹241.09 million of foam trims, ₹56.37 million of binders, ₹152.77 million of finished foam sheets and ₹218.31 million of carpet underlay accessories (DRHP p.236). It is also setting up a biomass gasification and biochar plant, designed for about 3,750 tonnes of biochar a year, and has signed a memorandum of understanding for a carpet underlay factory joint venture in Dundee, Scotland (DRHP p.233, DRHP p.231).

Earnings equation: Revenue ≈ tonnes of manufactured foam sold × realisation per tonne + traded goods. Manufactured goods sold were 6,748 MT in FY24, 8,338 MT in FY25 and 12,636 MT in FY26 (DRHP p.125).

03Where the money comes from

Source: DRHP p.49; the "other manufactured" row is our arithmetic, adding foam blocks, scrap and by-product, and other items. Manufacturing was 66.93% of FY26 revenue and trading 32.62%, against 43.82% and 56.17% in FY25 (DRHP p.223). Carpet underlays, a new product in FY26, were 23.70% of revenue (DRHP p.49).

By geography, Madhya Pradesh was 24.62% of FY26 revenue, Tamil Nadu 15.96% and Uttar Pradesh 9.06%; the United Kingdom was 29.31% and Australia 5.33% (DRHP p.228). In FY25 revenue from outside India was ₹1.10 million, 0.06% (DRHP p.34).

Source: DRHP p.30. The document gives the top three, not the largest single customer. Revenue depends on a few customers: ten took 81.00% of FY26 revenue, down from 96.34% in FY25 (DRHP p.30). The company sold to 102 customers in FY26 against 51 in FY25, and 73 new customers brought ₹876.30 million, 42.51% of FY26 revenue (DRHP p.227). Repeat customers were 57.75% of FY26 product revenue against 99.55% in FY24 (DRHP p.36). It works mostly on purchase orders, not long-term contracts (DRHP p.30). On the supply side, the top ten suppliers were 81.76% of FY26 purchases and the top three 47.80% (DRHP p.31).

04The growth record

Source: DRHP p.82, DRHP p.83, DRHP p.84, DRHP p.158, converted from ₹ million.

Our arithmetic over FY24 to FY26: revenue grew about 24.9% a year (our arithmetic, DRHP p.83), EBITDA about 64.3% a year (our arithmetic, DRHP p.158) and profit after tax about 59.9% a year (our arithmetic, DRHP p.83). EBITDA margin moved from 9.3% to 16.1%, up 676 basis points (DRHP p.158), and PAT margin from 5.23% to 8.56%, up 333 basis points (DRHP p.158).

The company itself states the same three rates, 24.94%, 64.25% and 59.92% (DRHP p.229). In rupees, revenue went from ₹132.0 crore to ₹206.1 crore and profit after tax from ₹6.9 crore to ₹17.7 crore (DRHP p.83). Year by year, revenue rose 32.4% in FY25 and 17.9% in FY26, and profit after tax 50.0% and 70.5% (our arithmetic, DRHP p.83).

Operating cash flow was ₹154.12 million in FY26, about ₹15.4 crore, after ₹17.77 million in FY25 and ₹32.05 million in FY24 (DRHP p.84). Other income of ₹26.58 million was 10.9% of FY26 profit before tax of ₹242.86 million (our arithmetic, DRHP p.83); ₹24.05 million of it was a foreign exchange gain (DRHP p.47).

Net debt to EBITDA was about 1.8× at March 2026: borrowings of ₹987.34 million less cash of ₹48.42 million and other bank balances of ₹343.00 million, against EBITDA of ₹330.89 million (our arithmetic, DRHP p.82, DRHP p.158). Debt to equity was 1.39 times, about 1.4× (DRHP p.158), and RoCE 22.2% in FY26 (DRHP p.158). Net working capital was 94 days in FY26 (DRHP p.35).

Contingent liabilities were ₹92.45 million at March 2026, about ₹9.2 crore, of which ₹89.17 million is an export obligation under the EPCG scheme for machinery imported at a concessional duty (DRHP p.85).

Two items affect the FY26 balance sheet. The ₹343.00 million in other bank balances and in equity was share application money received before March 31, 2026 for shares allotted on April 4, 2026, so FY26 net worth of ₹710.85 million already includes it (DRHP p.84, DRHP p.331, DRHP p.106). The year end is March 31 throughout and no restatement of a year is described (DRHP p.25). The statutory auditor reports no qualification, reservation or emphasis of matter (AP p.12, DRHP p.300).

05What the growth is made of

Revenue rose ₹740.85 million from FY24 to FY26 (our arithmetic, DRHP p.83). Manufactured revenue added ₹717.24 million, traded revenue ₹14.30 million and export incentives ₹9.30 million (our arithmetic, DRHP p.49).

Manufactured goods sold rose from 6,748 MT to 12,636 MT while manufactured revenue rose from ₹662.24 million to ₹1,379.48 million (DRHP p.125). At the FY24 realisation of about ₹98,139 a tonne, the extra 5,888 tonnes account for roughly ₹577.84 million; the remaining ₹139.40 million is realisation and mix, with FY26 realisation about ₹109,171 a tonne (our arithmetic, DRHP p.125). The company attributes the FY26 rise in manufactured revenue to higher volume and higher realisation on sales outside India (DRHP p.381).

New capacity carried the volume: installed capacity went from 7,650 MTPA in FY24 to 15,500 MTPA in FY26, with Dadri added and Silvassa back in full operation after a fire, and Hyderabad wound up (DRHP p.242, DRHP p.243). New products and a new geography carried the rest: carpet underlays, ₹488.57 million made and ₹218.31 million of accessories traded, did not exist before FY26, and outside India grew from ₹1.10 million to ₹715.35 million in a year (DRHP p.49, DRHP p.34).

In FY25 traded revenue rose 49.24% because one plant was not operating for part of the year and another started in February 2025, so the company sourced goods from others to keep supplying customers; in FY26 traded revenue fell 31.54% as its own production rose (DRHP p.384, DRHP p.381). The document does not give price per tonne by product or by market, so the realisation effect cannot be split further.

06Earnings quality

The item that needs explaining is working capital. Trade receivables went from ₹100.59 million at March 2024 to ₹623.66 million at March 2026, and receivable days from 42 to 79 (DRHP p.37). In FY26 receivables rose ₹336.96 million, offset by a ₹224.04 million rise in payables (DRHP p.84). Inventory days rose from 59 to 100 (DRHP p.32). The rise in receivables came in the year export sales started; the document does not split receivables between Indian and overseas customers.

The FY26 profit also includes ₹24.05 million of foreign exchange gain, and the company has no hedging policy (DRHP p.47). Bad debts written off were ₹3.29 million in FY26 against ₹0.76 million in FY25 (DRHP p.84).

07The balance sheet

At March 31, 2026 total assets were ₹2,230.16 million: trade receivables ₹623.66 million, inventories ₹381.58 million, property, plant and equipment ₹401.76 million, capital work in progress ₹198.54 million, cash ₹48.42 million and other bank balances ₹343.00 million (DRHP p.82). Against that: borrowings of ₹606.46 million current and ₹380.88 million non-current, lease liabilities of ₹74.85 million, trade payables of ₹358.06 million and total equity of ₹721.60 million including ₹10.75 million of non-controlling interest (DRHP p.82, DRHP p.334).

Borrowings at March 2026 were mostly bank debt: cash credit of ₹488.41 million, term loans from banks of ₹295.98 million secured and ₹28.53 million unsecured, and ₹45.36 million of loans from related parties (DRHP p.334). The promoter's loan is interest-free (DRHP p.334). By August 31, 2026 secured fund-based borrowings were ₹832.45 million against ₹1,592.97 million sanctioned, and unsecured loans ₹131.69 million, of which ₹64.07 million from related parties and individuals (DRHP p.395). Interest rates run from 7.75% to 16.00% (DRHP p.395). The bank facilities carry a CRISIL BBB/Stable rating dated June 25, 2026 (DRHP p.65).

Capital commitments were ₹37.30 million on capital account, and the company has agreed to lend up to GBP 1.6 million to its UK subsidiary, of which ₹150.69 million is shown as an other commitment (DRHP p.85, DRHP p.56). Insurance covered ₹783.34 million of ₹981.88 million of tangible assets, 79.78% (DRHP p.51).

After the issue, as far as the arithmetic goes: ₹300.00 million of the fresh issue goes to repaying borrowings, ₹200.00 million in FY27 and ₹100.00 million in FY28, from loans that stood at ₹370.92 million outstanding on August 31, 2026 (DRHP p.122, DRHP p.151). On March 2026 borrowings of ₹987.34 million, that would leave about ₹687.34 million before any new borrowing (our arithmetic, DRHP p.82, DRHP p.122). Net worth after the issue cannot be stated, because the price and therefore the amount raised are not set (DRHP p.104).

08What the money is for

Source: DRHP p.122; the percentages are our arithmetic on the ₹1,200.00 million named so far, because the gross fresh issue amount is not set. The plant is to cost ₹980.00 million: land ₹38.04 million already paid from internal accruals, civil and structural work ₹146.05 million, plant and machinery ₹783.49 million and a contingency of ₹12.42 million, as vetted in a cost report by Dun & Bradstreet dated September 29, 2026 (DRHP p.125, DRHP p.126).

Of the ₹900.00 million, ₹70.00 million is to be spent in FY27 and ₹830.00 million in FY28 (DRHP p.122). Commercial production is scheduled for December 2027, after orders for plant and machinery are placed in February and March 2027 (DRHP p.147).

The plant is to add about 9,000 MTPA, taking capacity from 15,500 MTPA to about 24,500 MTPA, and will also make carpet underlays (DRHP p.125, DRHP p.232). No definitive agreements with vendors have been signed; the costs rest on quotations (DRHP p.146). The land was allotted by MPIDC on September 28, 2026 for 99 years, the lease deed is still to be registered, and consent to establish from the state pollution control board is pending (DRHP p.34). No working capital for the new plant is included in the project cost (DRHP p.146). None of the objects has been appraised by a bank (DRHP p.101).

The loans named for repayment are four Kotak Mahindra Bank facilities, an India Exim Bank term loan and a Union Bank of India term loan, at rates of 7.75% to 9.50% (DRHP p.150, DRHP p.151). The company may also place shares before the red herring prospectus, up to 20% of the fresh issue, which would reduce the fresh issue (DRHP p.121).

Into the business 5,400,000 new shares, amount not yet set; named objects ₹1,200.00 million (DRHP p.79, DRHP p.122). To selling shareholders 1,350,000 existing shares from the promoter, amount not yet set (DRHP p.79).

09Who is selling

Source: DRHP p.80, DRHP p.113; the last column is our arithmetic. The offer is 6,750,000 shares: a fresh issue of 5,400,000 shares and an offer for sale of 1,350,000 shares by 1 selling shareholder, so the offer for sale is 20% of the shares offered (DRHP p.79). Named objects of the fresh issue come to ₹120.0 crore before general corporate purposes (DRHP p.122).

The rupee size of both parts depends on the price, which is not set (DRHP p.79). The weighted average cost of the promoter's shares is ₹1.14 a share on the cover (DRHP p.1), while the capital structure chapter prints "NA" for the same figure (DRHP p.116). If bids fall short, 90% of the fresh issue is allotted first, then the promoter's shares, then the rest of the fresh issue (DRHP p.80).

10Promoters

The promoter is Kunal Giani, aged 41, Chairman and Managing Director, educated up to intermediate level, with over 15 years in the foam industry and with the company since incorporation in October 2018 (DRHP p.290, DRHP p.271). Kunal Giani and Geetika Giani were the original promoters; the board identified Kunal Giani as the only promoter on August 27, 2026 (DRHP p.290). The document states that Geetika Giani is the wife of Kunal Giani, and names Megha Singh as Kunal Giani's mother and Hardayal Verma and Archana Verma as the spouse's father and mother (DRHP p.292). The promoter holds 82.65%; the promoter group holds a further 200 shares (DRHP p.115).

Pay: Kunal Giani is entitled to ₹0.50 million a month from January 3, 2025 and received ₹6.00 million in FY26 (DRHP p.274). From the company the promoter received ₹2.00 million in FY25 and ₹6.00 million in FY26, and as a partner of Maxtar Industries ₹3.54 million in FY24 and ₹1.76 million in FY25 (DRHP p.89, DRHP p.90). That is about ₹0.4 crore in FY24 and ₹0.6 crore in FY26 (DRHP p.89, DRHP p.90).

The company also rented machinery from Kunal Giani at ₹1,11,500 a month under an April 2025 agreement ended on September 28, 2026 (DRHP p.276), and paid ₹1.13 million a year of rent to Sarva Foam, a proprietorship firm of the Managing Director (DRHP p.44).

Other businesses and deals with the company: the promoter group includes Bondpro Foam Industries Private Limited, Sarvapratham Hospitality Private Limited, Sarva Greenearth Private Limited, Sarva Foam (proprietorship), Universal Foam (proprietorship, GSTIN cancelled) and three family trusts (DRHP p.292). The document lists Bondpro Foam Industries and Universal Foam as ventures in the same line of business (DRHP p.50).

In October 2024 the company acquired 90% of Maxtar Industries from Kunal Giani for ₹62.67 million, and in March 2025 a further 5% for ₹4.81 million, both effective April 1, 2024 (DRHP p.263, DRHP p.264). In FY25 Kunal Giani drew ₹67.98 million from Maxtar Industries (DRHP p.88). Kunal Giani still holds 2% of Maxtar and Vijay Pal Singh Parmar 3%; the document describes Maxtar as a supplier of raw materials to the company (DRHP p.273).

Guarantees and cases: Kunal Giani has personally guaranteed ₹1,355.47 million of loans, about ₹135.5 crore, including ₹150.00 million for a Central Bank of India term loan to Sarvapratham Hospitality Private Limited (DRHP p.60). No promoter share is pledged (DRHP p.114). There are no criminal, regulatory, tax or material civil proceedings against the promoter and no SEBI or exchange action in the last five years (DRHP p.400). The company has applied to SEBI to be exempted from naming Megha Singh and related entities as promoter group, and its disclosure about Megha Singh is limited to public records (DRHP p.61).

Promoter economics: Kunal Giani subscribed 8,000 shares at ₹10 in October 2018 and 39,800 shares in a rights issue at ₹400 in March 2022 (DRHP p.114). Geetika Giani gifted 10,155 shares to Kunal Giani in April 2024 and transferred 1,795 shares to Vijay Pal Singh Parmar at ₹1,580 each (DRHP p.110).

After a split from ₹10 to ₹5 and the purchase of 5 shares from Vijay Pal Singh Parmar at ₹3,080 each in December 2024, Kunal Giani received 13,909,800 bonus shares in a 120:1 bonus on December 30, 2024 (DRHP p.114). The weighted average cost of all shares acquired in the last three years is ₹20.75, and in the last year ₹150 (DRHP p.117).

11Who already owns it

Source: DRHP p.113; the "other shareholders" row is our arithmetic. The company has 30 shareholders and no employee stock option scheme (DRHP p.113, DRHP p.109). The next largest holders are SB Opportunities Fund I and KIFS Finstock Limited at 0.79% each and Evergrow Capital Opportunities Fund at 0.69% (DRHP p.115).

When they came in: every non-promoter holder except Vijay Pal Singh Parmar entered on April 4, 2026, when 2,333,336 shares were allotted at ₹150 each to 22 investors in a private placement, about ₹350.0 million (DRHP p.106, DRHP p.107).

Navbharat Investment Opportunities Fund led the round under a share subscription and shareholders' agreement of March 21, 2026 that gave it a board observer and veto rights; those rights are waived from the filing of the red herring prospectus and the agreement ends on listing (DRHP p.265). Before that, a rights issue on January 29, 2025 allotted 176,769 shares at ₹5 each, by conversion of an unsecured loan of ₹0.89 million (DRHP p.106, DRHP p.332).

If the full 5,400,000 fresh shares are issued and the promoter sells 1,350,000, with no pre-IPO placement, the promoter would hold 12,675,715 of 22,369,605 shares: 82.7% before and 56.7% after (our arithmetic, DRHP p.79, DRHP p.113). The document itself leaves the post-offer holding blank (DRHP p.115).

12What changed just before the IPO

• Revenue and profit: revenue went from ₹132.0 crore in FY24 to ₹206.1 crore in FY26, and profit after tax from ₹6.9 crore to ₹17.7 crore (DRHP p.83).
• Exports began. Sales outside India started in April 2025; revenue from outside India was 34.7% of FY26 revenue (DRHP p.34), and the United Kingdom alone 29.3% of FY26 revenue (DRHP p.35). The document also gives 34.39% in one place (DRHP p.230).
• Indian revenue fell. Revenue from within India went from ₹174.7 crore in FY25 to ₹133.7 crore in FY26 (DRHP p.34).
• The customer list widened. The top three customers were 45.6% of FY26 revenue (DRHP p.30), the top five 62.3% (DRHP p.30) and the top ten 81.0% (DRHP p.30), against 63.83%, 88.28% and 95.06% in FY24 (DRHP p.30).
• Trading shrank as production grew. Trading was 32.6% of FY26 revenue against 56.17% in FY25 (DRHP p.223).
• Receivables lengthened from 42 days in FY24 to 79 days in FY26 (DRHP p.37).
• Promoter pay: about ₹0.4 crore in FY24, as a partner of Maxtar Industries, and ₹0.6 crore in FY26 as Managing Director (DRHP p.89, DRHP p.90).
• Maxtar Industries moved in: the company took 95% of the promoter's partnership firm for ₹67.48 million in total, effective April 1, 2024 (DRHP p.263, DRHP p.264).
• Plants changed: Silvassa was shut by a fire on June 28, 2023 and not fully operating until February 1, 2025; Dadri started in FY25; Hyderabad was wound up from October 2024 (DRHP p.38, DRHP p.243).
• A share split and a bonus: each ₹10 share was split into two of ₹5 under resolutions of December 9 and 11, 2024, and a bonus of 120 shares for each share held was allotted on December 30, 2024 (DRHP p.106).
• A rights issue at ₹5 on January 29, 2025, converting a ₹0.89 million unsecured loan (DRHP p.106, DRHP p.332).
• The company became public: converted to a public company with a certificate dated February 22, 2025 (DRHP p.3).
• A private placement at ₹150: 2,333,336 shares to 22 investors on April 4, 2026, the last allotment before the offer (DRHP p.106).
• The statutory auditor changed: B. B. Shah & Company resigned on August 26, 2026, citing pre-occupation, and S.L. Chhajed & Co. LLP was appointed on September 1, 2026 (DRHP p.100, DRHP p.101).
• New board members: two executive directors and an independent director joined on August 27, 2026, and three independent directors in 2025 (DRHP p.276).
• New objects: the memorandum of association was amended in July 2026 to add renewable energy, biochar and carbon credit businesses, and its objects were renumbered in September 2026 (DRHP p.260, DRHP p.261).
• Borrowing rose from ₹339.22 million at March 2024 to ₹987.34 million at March 2026 (DRHP p.334).
• Compliance: the company filed for adjudication of penalties for a 79-day shortfall in minimum board strength, quorum failures and missing particulars on business letters (DRHP p.61).

13Capacity and expansion

Source: DRHP p.242, DRHP p.243, DRHP p.125, DRHP p.147; capacity and utilisation are certified by an independent chartered engineer and computed on three shifts and 288 working days a year (DRHP p.124). Overall utilisation was 89.08% in FY24, 72.81% in FY25 and 81.06% in FY26 (DRHP p.124). The Krishnagiri Unit II addition is not funded from the issue and its timing is not given (DRHP p.243).

The chain from capacity to revenue is not drawn in the document. Krishnagiri Unit I ran at 98.70% in FY26 while Dadri ran at 63.41%, so the plants are not equally loaded (DRHP p.242). Including the Krishnagiri Unit II addition and the Bhopal plant, capacity would rise to about 28,600 MTPA, against 12,636 MT of manufactured goods sold in FY26 (our arithmetic, DRHP p.243, DRHP p.125). The document does not say how much of the new capacity is for carpet underlay for export.

14Market size and industry structure

As claimed: the industry report is by Dun & Bradstreet Information Services India, "Indian Rebonded Polyurethane Foam Market", dated September 29, 2026, commissioned and paid for by the company for the offer (DRHP p.27). It puts the organised Indian rebonded PU foam market at about ₹275 crore in FY22 and about ₹400 crore in FY26, an estimate (DRHP p.199), and the global market at about USD 1,114 million in CY2025 (DRHP p.125), with Europe about 40% of it (DRHP p.199) and the United Kingdom about USD 132 million (DRHP p.208).

The part that is addressable: rebonded foam sheets and blocks sold to mattress, furniture and industrial buyers in India, and rebonded carpet underlay sold mainly in the United Kingdom and Australia. The commissioned report credits the company with about 33% of the Indian market in FY26 and calls it the largest exporter of rebonded PU foam from India (DRHP p.223).

What the company is today: revenue from within India of ₹1,336.56 million in FY26, about 33% of the ₹400 crore Indian figure, though that revenue includes traded trims and binders (our arithmetic, DRHP p.34, DRHP p.199). FY26 exports of flexible PU products from India, rebonded foam included, are put at ₹86.12 crore, against the company's ₹71.5 crore of revenue from outside India (DRHP p.125, DRHP p.34).

On structure, the commissioned report describes a mix of specialised rebonders, integrated foam makers, mattress companies that rebond their own trims and many regional unorganised players, with competition driven by access to trims, price, relationships with mattress makers and location (DRHP p.206). Demand comes mainly from mattresses, with carpet underlay, sports flooring and acoustic uses growing (DRHP p.199, DRHP p.207). India has no dedicated waste or extended producer responsibility rule for PU foam yet (DRHP p.206). Raw material imports were ₹8.43 million in FY26, 0.61% of raw material purchases, against ₹116.59 million in FY24 (DRHP p.47).

15Competitive position

Source: DRHP p.161, DRHP p.162, DRHP p.207, DRHP p.208. Brahma Foam and Sleeploop figures come from the commissioned report and are for FY25, as FY26 accounts were not filed (DRHP p.207). The document also names Saloni Coir Private Limited and AR Foam Industries as competitors without figures (DRHP p.53).

What the company puts forward: plants near large customers such as Duroflex and Sheela Foam and near ports, ISO 9001:2015 at all units, a preferred-supplier position with one leading mattress brand and supply arrangements with others, and scale in buying trims (DRHP p.226, DRHP p.227). Against that: no long-term contracts with customers or suppliers, customers that are also suppliers, the United Kingdom at 29.31% of revenue through sales agents, and a logo trademark application under objection (DRHP p.30, DRHP p.31, DRHP p.228, DRHP p.52).

16Peers the company named

Peers named in the offer document: Sheela Foam Limited (DRHP p.157).

The company says no listed peer in India or abroad is comparable to its scale and names Sheela Foam because some of its verticals match (DRHP p.27, DRHP p.28). Sheela Foam's FY26 revenue of ₹38,208.40 million is about 18.5 times the company's (our arithmetic, DRHP p.157). The document prints Sheela Foam's P/E as 43.99 on its closing price of August 31, 2026, also the highest, lowest and average of the peer set (DRHP p.157). The company's FY26 basic EPS is ₹12.06 on the ₹5 share (DRHP p.157). With no price band, no P/E for the company can be stated.

17Risks, in plain words

Customers: ten customers took 81.00% of FY26 revenue and the company works on purchase orders (DRHP p.30) → losing one large mattress maker moves the year → the top three alone were 45.61% (DRHP p.30).

One export market: the United Kingdom was ₹604.15 million, 29.31% of FY26 revenue and 84.45% of revenue from outside India, reached mainly through sales agents (DRHP p.35, DRHP p.224) → this business is one year old and the company has no hedging policy (DRHP p.47) → revenue from within India fell 23.5% in FY26 (our arithmetic, DRHP p.34).

Suppliers who are customers: the top ten suppliers were 81.76% of FY26 purchases, and some of them are among the top customers (DRHP p.31) → trims come from the same foam makers the company sells to → raw material was 34.59% of FY26 revenue (DRHP p.32).

Working capital: receivable days rose from 38 to 79 and inventory days from 80 to 100 in FY26 (DRHP p.37, DRHP p.32) → more cash is tied up as the company grows → cumulative operating cash flow over FY24 to FY26 was ₹203.94 million against ₹349.10 million of profit (our arithmetic, DRHP p.83, DRHP p.84).

Project to be built: ₹900.00 million goes to a plant with no vendor agreements, a lease deed still to be registered and consent to establish pending (DRHP p.146, DRHP p.34) → commercial production is scheduled for December 2027 (DRHP p.147).

Debt and guarantees: borrowings were ₹987.34 million at March 2026, with debt to equity of 1.39 times and debt service coverage down from 3.94 to 1.63 times over FY24 to FY26 (DRHP p.49) → the promoter guarantees ₹1,355.47 million of loans (DRHP p.60).

Concentration of control: the promoter holds 82.65% and would still hold a majority after the offer (DRHP p.113) → related-party dealings include rent to the promoter's firm, machinery rented from the promoter and the purchase of the promoter's partnership firm (DRHP p.44, DRHP p.276, DRHP p.263).

Compliance record: adjudication applications for board strength and quorum lapses, late professional tax payments in 12 instances in FY26, and pending fire and pollution approvals at Silvassa (DRHP p.61, DRHP p.39) → a fire at Silvassa in June 2023 caused ₹22.25 million of losses against ₹16.00 million recovered from insurance (our arithmetic, DRHP p.38).

Issue-specific: the offer for sale goes to the promoter, whose weighted average cost is ₹1.14 a share (DRHP p.1); 22 investors came in at ₹150 a share in April 2026 (DRHP p.106); the general corporate purposes amount and expenses are blank; and a pre-IPO placement of up to 20% of the fresh issue may be made (DRHP p.121).

18Litigation and regulatory matters

In the customs case the company says an imported consignment was classified as waste and seized; the High Court ordered its release against a bond on June 17, 2025, and the company says the authorities did not act on that order (DRHP p.398, DRHP p.399). Criminal: there are no criminal proceedings by or against the company, subsidiaries, directors, promoter or key managers (DRHP p.398, DRHP p.399, DRHP p.401).

Regulatory: no action by a regulator is pending against any of them (DRHP p.398, DRHP p.400). Civil: no material civil case against the company, directors or promoter (DRHP p.398, DRHP p.399). Group companies have no litigation the board considers material (DRHP p.400). Separately, the company has filed for adjudication of penalties under the Companies Act for three compliance lapses (DRHP p.61).

19Related-party transactions

Source: DRHP p.88, DRHP p.89, DRHP p.90, DRHP p.87, DRHP p.44; the remuneration row for FY25 is our arithmetic, adding ₹2.00 million from the company and ₹1.76 million from Maxtar. Maxtar Industries is consolidated, so its trade with the company is inside the group; before April 2024 it was the promoter's firm (DRHP p.265, DRHP p.264).

The company also lent ₹2.36 million in FY24 and ₹0.61 million in FY25 to Bondpro Foam Industries Private Limited, a company in which a relative of the Managing Director has significant influence (DRHP p.87). Interest paid to Kunal Giani was ₹1.10 million in FY24 and ₹1.76 million in FY25 from the company, and ₹5.88 million, ₹4.36 million and ₹0.08 million from Maxtar over the three years (DRHP p.90).

What appeared or changed in the two years before filing: the purchase of 95% of Maxtar Industries from the promoter for ₹67.48 million; the ₹67.98 million drawing by the promoter from Maxtar in FY25; Managing Director pay from January 2025; machinery rented from the promoter from April 2025 and the rental ended in September 2026; and loans and trade advances between the company and its two UK subsidiaries, set up in 2024 (DRHP p.263, DRHP p.264, DRHP p.88, DRHP p.274, DRHP p.276, DRHP p.288).

20What the offer document does not say

The largest single customer and its share are not given, only the top three. Price per tonne by product and by market is not given, so the realisation effect on growth cannot be split further. Receivables are not split between Indian and overseas customers. Margins on manufactured and traded goods are not given separately. The terms of the United Kingdom sales agents and the share of export revenue that passes through them are not given. The timing and cost of the Krishnagiri Unit II addition are not given. The general corporate purposes amount, offer expenses, price band and post-offer holdings are blank.

Some inconsistencies are recorded as document matters, not business ones: the promoter's weighted average cost is ₹1.14 on the cover and "NA" in the capital structure chapter (DRHP p.1, DRHP p.116); the share of FY26 revenue from outside India is 34.71% in one place and 34.39% in another (DRHP p.34, DRHP p.230);

the MD&A puts FY26 revenue from manufactured goods at ₹1,336.56 million, the figure the document elsewhere gives for revenue within India, against ₹1,379.48 million in the segment table (DRHP p.381, DRHP p.49); the April 2026 private placement is shown with total consideration of ₹16.97 million although 2,333,336 shares at ₹150 come to about ₹350.0 million (DRHP p.163, our arithmetic, DRHP p.106);

one investor is named KIFS Dealers in the allotment and KIFS Finstock Limited in the shareholder list (DRHP p.107, DRHP p.115); and the transfer of the Maxtar stake is 90% in one place and 90.30% in another (DRHP p.263, DRHP p.291).

21Five questions for management

1. What share of FY26 revenue came from the single largest customer, and is any one customer above 20%?
2. How much of the ₹623.66 million of receivables at March 2026 was due from overseas customers, and what had been collected by September 2026?
3. What were the realisations per tonne in India and in the United Kingdom in FY26, and how much of the ₹139.40 million realisation and mix effect came from exports?
4. What commission is paid to the United Kingdom sales agents, and do any agreements fix volumes or prices?
5. With Dadri at 63.41% utilisation in FY26, what output does the Bhopal plant need to cover its own depreciation and interest?

2Sources and cited facts

This study was read from 2 documents the company filed. The 154 figures it cites are listed under the document each came from, with the page and the sentence as printed.