Indo Count FY26: Flat revenue, weaker margins, and a big FY27 ramp-up plan

Indo Count Industries Limited ended FY26 with revenue that stayed broadly flat, but with profitability under pressure. Consolidated total income for FY26 stood at 4,211 crore versus 4,191 crore in FY25. EBITDA declined to 461 crore from 577 crore, and EBITDA margin fell to 11 percent from 13.8 percent. PAT was 127 crore versus 250 crore in FY25.

Q4 FY26 showed early signs of recovery in operating performance. Total income rose to 1,088 crore, up 5.8 percent year on year and 1.3 percent quarter on quarter. EBITDA increased to 116 crore versus 102 crore in Q3 FY26, and margin improved to 10.7 percent. PAT remained steady at 24 crore, with management attributing the limited flow-through to higher interest and depreciation after commissioning new US facilities.

The core challenge through FY26 was a volatile environment in the company’s largest market. Management highlighted the evolving US tariff situation, with tariff levels shifting during the year, and noted that parts of the impact were shared with customers on a case-by-case basis to protect relationships and market share. This, along with product mix changes, incubation costs for new initiatives, and under-absorption of fixed costs due to softness in the core business, weighed on margins.

A shift in mix: new businesses move from 7 percent to 19 percent

A key positive in FY26 was the scaling up of the company’s newer verticals. Indo Count’s revenue mix has shifted meaningfully over the last year.

In FY26, the core business, largely bed linen, generated 3,419 crore. New businesses, consisting of utility bedding and the USA brand business, delivered 792 crore. As a share of total revenue, the company reported the mix moving from 93 percent core and 7 percent new businesses in FY25 to 81 percent core and 19 percent new businesses in FY26.

Management also stated that new businesses scaled from 33 million dollars in FY25 to 90 million dollars in FY26, and that the new business segment has reached an annualised revenue run rate of more than 100 million dollars.

Financial summary (consolidated)

Note: The presentation states that prior period numbers are restated.

Indo Count 2.0: from bed linen exporter to value-added home solutions

The presentation positions the company’s strategy as Indo Count 2.0, a transition from a single core exporter model to a multi-vertical home textiles platform. The company describes diversification across products, channels, and geography, including building a manufacturing base in the United States.

In utility bedding, Indo Count now operates three manufacturing facilities in the USA in Ohio, Arizona, and North Carolina. The company commissioned a greenfield facility in Kernersville, North Carolina, which it states more than doubled annual manufacturing capacity to 31 million pillows, with additional stated capacity of 1.5 million quilts per annum. The North Carolina facility began commercial production in January 2026 and is currently ramping up.

Alongside the manufacturing build-out, Indo Count is also expanding its brand platform. The company highlights the relaunch of Wamsutta in the US market with a digital-first D2C strategy, and notes it launched as D2C in July 2025. It also states it signed the licensed brand Tommy Hilfiger for utility bedding, taking the licensed brand portfolio count to six brands.

FY27 guidance: targeting 5,500 crore revenue and 13 percent EBITDA margin

Management’s forward commentary is clear: FY27 is expected to be a record year, driven by a combination of core business growth and rapid scaling of new businesses.

The company guided FY27 volume at 105 to 110 million meters versus 94.1 million meters in FY26. It guided FY27 total income at around 5,500 crore versus 4,211 crore in FY26 and EBITDA margin at 13 percent versus 11 percent in FY26. It also stated an incremental revenue addition target of about 1,300 crore in FY27.

The narrative behind the guidance is that major growth investments have largely been completed, and the focus is shifting to sweating assets, improving operating leverage, strengthening cash flows, and reducing debt.

Capex plan

Indo Count disclosed FY26 capex at 145 crore and FY27e capex at 250 crore, to be completed over the next 12 to 18 months. Key planned items include an effluent treatment plant at Bhilad and a spinning brownfield expansion of 24,000 spindles plus modernization. The company indicated the FY27e capex will be funded through a mix of internal accruals and debt.

What to track from here

FY26 underlined how sensitive the core export business remains to external disruptions such as tariffs and geopolitical events. Management also cautioned that the ongoing West Asia conflict could have an impact on the global economy, which will need monitoring.

At the same time, the year showed that Indo Count’s diversification is no longer a small pilot. New businesses rose to 19 percent of consolidated revenue in FY26, and Q4 showed improved margins partly driven by greater contribution from these segments.

FY27 will test whether the new manufacturing footprint and brand investments translate into sustained operating leverage. The company’s guidance is explicit, and the next few quarters should reveal how quickly volumes, margins, and throughput ramp up across both core and new verticals.