Duroflex IPO

Strengths · 8

• 01Profit after tax was Rs 47.16 crore in FY2025, against Rs 11.20 crore in FY2024 and a loss of Rs 15.47 crore in FY2023.
• 02Total borrowings fell from Rs 154.10 crore on 31 March 2023 to Rs 9.80 crore on 31 March 2025, against a net worth of Rs 398.88 crore.
• 03Net cash from operating activities was Rs 108.20 crore in FY2025, more than twice the profit after tax of Rs 47.16 crore.
• 04EBITDA margin rose from 5.38% in FY2023 to 8.64% in FY2025, and net working capital days fell from 18.61 to 12.18.
• 05The company reports about 20% share of the branded modern mattress market in South India for Fiscal 2025, where it says it is among the top two players.
• 06It sells through 73 COCO stores, 5,576 trade stores and 375 distributors, besides online channels, so it is not tied to one route to the customer.
• 07Seven plants make foam and mattresses in-house. FY2025 capacity use was 78.39% for foam and 69.45% for mattresses, as stated in the document.
• 08Return on equity was 12.72% and ROCE was 14.90% in FY2025, against 3.28% and 5.59% in FY2024.

Risks · 10

• 01Two products carry the business. Mattresses gave 51.41% and branded foam gave 39.37% of FY2025 revenue from operations.
• 02Revenue growth is slow. Revenue from operations grew 3.56% in FY2025 and 3.58% in FY2024, and the FY2025 profit jump came with an EBITDA margin of 8.64%.
• 03The offer includes an offer for sale of up to 2,25,64,569 shares, so part of the money goes to the selling shareholders and not to the company.
• 04Lighthouse India Fund III, Limited has an average cost of Rs 114.23 per share and is selling up to 94,60,574 shares, while the promoters' average cost is between Rs 1.57 and Rs 2.63 per share.
• 05General corporate purposes are not fixed and may be up to 25% of the gross proceeds. Any pre-IPO placement of up to Rs 36.72 crore would also go towards this portion.
• 06The top 10 suppliers gave 57.36% of FY2025 raw material cost, and Pon Pure Chemical India Private Limited alone gave 22.18%. There are no long term supply contracts.
• 07All COCO stores are on leased, sub-leased or leave and license premises, and Rs 42.13 crore of the fresh issue is for rent on existing stores and one plant.
• 08Contingent liabilities on 30 June 2025 included Rs 35.06 crore of GST claims and Rs 14.86 crore of income tax claims, apart from a corporate guarantee of Rs 25.19 crore for a subsidiary.
• 09Litigation against the company has an aggregate amount of Rs 70.74 crore, with 11 tax proceedings, 2 criminal cases and 2 material civil cases.
• 10Cost of materials consumed rose from 50.60% of revenue in FY2023 to 54.17% in FY2025, and the attrition rate among permanent employees was 23.00% in FY2025.

Duroflex Limited is a provider of sleep and comfort solutions in India. It makes foam, mattresses, sofas, recliners, beds, pillows, accessories and other furnishings. The company says it has seven manufacturing facilities across India and can produce all of its mattresses and foam in-house.

It sells under a house of brands. Mattresses, furniture and other sleep products are sold as Duroflex, Sleepyhead and Perfect Rest, and branded foam is sold as Durofoam. Each brand is meant for a different customer segment and price point. As of 30 June 2025 the company offered more than 3,900 SKUs in mattress categories.

Sales go through several channels. The company runs 73 company-owned company-operated (COCO) stores in 31 cities across 14 states and 2 union territories. Its general trade network covers 375 distributors and 5,576 trade stores, including franchisee stores. It also sells online on its own websites and on e-commerce marketplaces, and supplies mattresses to hospitality, co-living, hospital, education and government buyers. Branded foam is sold as an intermediate product to makers of bedding, furniture, automotive parts and footwear. In FY2025, the offline channel gave 83.02% of revenue and the online channel gave 16.98%.

In FY2025, mattresses gave Rs 583.07 crore of revenue and branded foam gave Rs 446.53 crore. Furniture gave Rs 61.02 crore and accessories gave Rs 33.86 crore. The company sold 7,98,021 mattresses and 21,290 tonnes of branded foam that year. Its available capacity in FY2025 was 36,036 metric tons of foam and 1.2 million mattresses.

The predecessor entity was incorporated in 1963 and the Duroflex brand was registered in 1981. The company has subsidiaries Sleepyhead Home Decor Private Limited, REM42 and Shivaarna. It is led by four promoters, Jacob Joseph George, Mathew Chandy, Mathew George and Mathew Antony Joseph. The document says it was supported by 2,111 employees, of whom 797 are permanent.

The industry

The industry report in the document estimates India's PU foam market at about Rs 198.00 billion in Fiscal 2025, up from Rs 122.00 billion in Fiscal 2020, and projects Rs 366.00 billion by Fiscal 2030. The modern mattress market grew at a CAGR of about 8.6% from Rs 108 billion in Fiscal 2020 to Rs 163 billion in Fiscal 2025. It is expected to grow at about 10.7% a year to reach Rs 271 billion by Fiscal 2030. The company says it is among the top two players in the branded modern mattress segment in South India, with a market share of about 20% in Fiscal 2025.

Customer concentration: The document gives no customer concentration table in the sections read. Its top 10 suppliers gave 57.36% of FY2025 raw material cost.