Sarva Foam Industries IPO

Strengths · 7

• 01Revenue from operations rose from Rs 132.04 crore in FY2024 to Rs 174.84 crore in FY2025 and Rs 206.12 crore in FY2026, growth of 32.42% in FY2025 and 17.89% in FY2026.
• 02EBITDA margin improved from 9.29% in FY2024 to 13.45% in FY2025 and 16.05% in FY2026, and profit after tax margin from 5.23% to 8.56%.
• 03The company estimates a market share of around 33% in FY2026 in a rebonded PU foam market of about Rs 400 crore, according to the D&B report.
• 04Installed capacity went from 7,650 MTPA in FY2024 to 15,500 MTPA in FY2026, with 81.06% utilised in FY2026.
• 05The customer base grew from 51 customers in FY2025 to 102 in FY2026, and the top 5 customers share fell from 81.20% to 62.25% of revenue.
• 06Four plants across Uttar Pradesh, Dadra and Nagar Haveli and Tamil Nadu let it serve northern, eastern, western and southern India.
• 07Net worth rose from Rs 18.96 crore at 31 March 2025 to Rs 71.09 crore at 31 March 2026.

Risks · 10

• 01The top 10 customers gave 81.00% of revenue from operations in FY2026 and 96.34% in FY2025. Losing one large buyer would hurt revenue.
• 02The top 10 suppliers made up 81.76% of purchases in FY2026, so supply or price problems with a few suppliers can hit costs.
• 03Total borrowings rose from Rs 33.92 crore in FY2024 to Rs 98.73 crore in FY2026, and the debt to equity ratio was 1.39 in FY2026.
• 04Operating cash flow was Rs 15.41 crore in FY2026 against profit after tax of Rs 17.65 crore, and only Rs 1.78 crore in FY2025 against Rs 10.36 crore profit. Inventory days rose from 59 in FY2024 to 100 in FY2026.
• 05Exports were 34.71% of FY2026 revenue from operations against 0.06% in FY2025, with the United Kingdom alone at 29.31%. This is a new market with a short track record.
• 06Rs 90.00 crore of the fresh issue is for a new plant, and the company has not yet registered the lease deed for the land where it will be built.
• 07General corporate purposes are not fixed yet and can be up to 25% of the gross proceeds.
• 08Rs 30.00 crore of the fresh issue is for repaying borrowings, which means part of the new money goes to lenders and not to growth.
• 09The promoter Kunal Giani is selling up to 13,50,000 shares at a weighted average cost of Rs 1.14 per share. The company does not receive money from this sale.
• 10Sales in Madhya Pradesh were 24.62% of revenue from operations in FY2026 and 38.97% in FY2025, so the business leans on a few regions.

Sarva Foam Industries Limited, based in Bhopal, Madhya Pradesh, makes rebonded polyurethane (PU) foam. It takes foam trims and off-cuts and turns them into new foam products using different grades of binders. The company says it is the largest rebonded PU foam player in India, with an estimated market share of around 33% in FY2026, and also the largest exporter of rebonded PU foam products in India. These claims come from the D&B industry report.

The company sells three kinds of products: rebonded foam sheets for mattresses, furniture and flooring, rebonded foam blocks for industrial conversion, and rebonded carpet underlays in rolls for carpet, sports and acoustic flooring. Besides manufacturing, it also trades in foam binders, foam trims and finished foam. In FY2026, manufacturing gave 66.93% of revenue from operations and trading gave 32.62%. Rebonded foam sheets made in-house were Rs 81.03 crore, and carpet underlays, a new line in FY2026, were Rs 48.86 crore.

It has four manufacturing units: one at Dadri in Uttar Pradesh, one at Silvassa in Dadra and Nagar Haveli, and two at Krishnagiri in Tamil Nadu. Installed capacity was 15,500 MTPA in FY2026 against 11,433 MTPA in FY2025 and 7,650 MTPA in FY2024. Capacity utilisation was 81.06% in FY2026. The company had 101 employees at the end of FY2026.

It sells on a business-to-business basis. Customers named in the document include Duroflex Limited, Sheela Foam Limited, Infinity Flooring and Repose Mattress Private Limited. In the last three fiscals it has sold in 19 states and union territories and 5 countries outside India. Exports began in FY2026, when sales to the United Kingdom, Australia, Qatar and Ireland made up 34.71% of revenue from operations. It runs a UK subsidiary structure, Sarva Global Ventures Ltd and its step-down subsidiary Sarva Foam UK Ltd, which trades in carpet underlay accessories.

Kunal Giani is the promoter and Chairman and Managing Director. He has over fifteen years of experience in the foam industry and has been with the company since it was incorporated in 2018.

The industry

The D&B report says the organised Indian rebonded polyurethane foam market grew from about Rs 275 crore in FY2022 to about Rs 400 crore in FY2026E, a CAGR of around 9.8%. It is projected to reach about Rs 650 crore by FY2031, a CAGR of around 10.2% between FY2026 and FY2031. Globally the rebonded PU market grew from about USD 865 million in CY2021 to about USD 1,114 million in CY2025, a CAGR of around 6.6%. Demand comes from mattresses, carpet underlays, acoustic solutions and sports flooring.

Customer concentration: Top 5 customers gave 62.25% of FY2026 revenue from operations (81.20% in FY2025 and 88.28% in FY2024). Top 10 customers gave 81.00%.