ICICI Direct has given Buy recommendation for Sheela Foam with a target price of Rs. 3650 in its research report issued on Sep 20, 2022

ICICI Direct’s research report on Sheela Foam

Sheela Foam (SFL) is the market leader in the domestic mattresses industry with a value market share of ~25% in the organised segment. The company’s “Sleepwell” is one of the leading brands in the domestic mattresses industry. It has a pan-India presence through ~6000 MBOs and ~5500 EBOs, respectively. Apart from India (contributes ~70% to the topline), the company also manufactures Polyutherene (PU)/technical foams in Australia and Spain with revenue contributions of 15% each. SFL has envisaged a capex of Rs 350 crore to increase its consolidated capacity by ~23% in the next two years. Revenue, earnings grew at CAGR of 11%, 13%, respectively, in FY18-22 • Cash surplus balance sheet with last three-year’s average RoE, RoCE of 19%, 22%, respectively.


We value SFL at 55x FY24EPS to arrive at a target price of Rs 3650/share.

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