Sheela Foam (NSEI:SFL) - Share price, News & Analysis

Q: What is the Fair Price of SFL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

SFL (₹2646.7) is trading above our estimate of [[fair value]] (₹1281.23)

SFL fundamental analysis
Snowflake Score
Valuation	0/6
Future Growth	5/6
Past Performance	2/6
Financial Health	5/6
Dividends	0/6

SFL Stock Overview

Sheela Foam Limited manufactures and sells polyurethane foams primarily in India and internationally.

Rewards

Earnings are forecast to grow 28.36% per year

Risk Analysis

No risks detected for SFL from our risk checks.

Sheela Foam Competitors

Faze Three

BSE:530079

₹8.4b

Wim Plast

BSE:526586

₹4.2b

TTK Prestige

BSE:517506

₹111.9b

Whirlpool of India

BSE:500238

₹198.1b

Price History & Performance

Summary of all time highs, changes and price drops for Sheela Foam
Historical stock prices
Current Share Price	₹2,646.70
52 Week High	₹4,055.00
52 Week Low	₹2,185.60
Beta	0.22
1 Month Change	-8.65%
3 Month Change	-23.83%
1 Year Change	18.65%
3 Year Change	104.66%
5 Year Change	106.56%
Change since IPO	156.46%

Recent News & Updates

Jun 10

Is Sheela Foam (NSE:SFL) Using Too Much Debt?

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

May 20

Sheela Foam (NSE:SFL) Could Be Struggling To Allocate Capital

What are the early trends we should look for to identify a stock that could multiply in value over the long term...

Shareholder Returns

	SFL	IN Consumer Durables	IN Market
7D	2.4%	4.6%	3.0%
1Y	18.6%	-16.3%	0.3%

Return vs Industry: SFL exceeded the Indian Consumer Durables industry which returned -15.9% over the past year.

Return vs Market: SFL exceeded the Indian Market which returned 0.6% over the past year.

Price Volatility

Is SFL's price volatile compared to industry and market?
SFL volatility
SFL Average Weekly Movement	3.7%
Consumer Durables Industry Average Movement	6.4%
Market Average Movement	7.0%
10% most volatile stocks in IN Market	9.9%
10% least volatile stocks in IN Market	4.5%

Stable Share Price: SFL is less volatile than 75% of Indian stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: SFL's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1971	1,968	Rahul Gautam	https://www.sheelafoam.com

Sheela Foam Limited manufactures and sells polyurethane foams primarily in India and internationally. The company provides various technical products, such as automotive, reticulated, silenctech, sound absorption, specialty, UV, rebounded, high resilience, pure grade, flame retardant, lamination grade, anti-static, UV stable, thermo-formable, hard and soft, and polyester grade foam products, as well as visco-elastic temperature sensitive materials. It also offers mattresses, pillows, mattress protectors, bolsters, back cushions, furniture cushioning, and other home comfort products and related articles.

Sheela Foam Fundamentals Summary

How do Sheela Foam's earnings and revenue compare to its market cap?
SFL fundamental statistics
Market Cap	₹129.01b
Earnings (TTM)	₹2.17b
Revenue (TTM)	₹29.82b

59.4x

P/E Ratio

4.3x

P/S Ratio

Is SFL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SFL income statement (TTM)
Revenue	₹29.82b
Cost of Revenue	₹19.05b
Gross Profit	₹10.77b
Other Expenses	₹8.60b
Earnings	₹2.17b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	44.55
Gross Margin	36.13%
Net Profit Margin	7.29%
Debt/Equity Ratio	24.1%

How did SFL perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is SFL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SFL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SFL. This is calculated by dividing SFL's market cap by their current preferred multiple.
What is SFL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	₹129.01b

SFL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	4.4x
Enterprise Value/EBITDA	42.1x
PEG Ratio	2.1x

Price to Earnings Ratio vs Peers

How does SFL's PE Ratio compare to its peers?

SFL PE Ratio vs Peers

The above table shows the PE ratio for SFL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	25x
530079 Faze Three	16.4x	n/a	₹8.4b
526586 Wim Plast	12.1x	n/a	₹4.2b
517506 TTK Prestige	36.7x	13.1%	₹111.9b
500238 Whirlpool of India	35x	n/a	₹198.1b
SFL Sheela Foam	59.4x	28.4%	₹129.0b

Forward PE

Price-To-Earnings vs Peers: SFL is expensive based on its Price-To-Earnings Ratio (59.4x) compared to the peer average (25x).

Price to Earnings Ratio vs Industry

How does SFL's PE Ratio compare vs other companies in the IN Consumer Durables Industry?

Price-To-Earnings vs Industry: SFL is expensive based on its Price-To-Earnings Ratio (59.4x) compared to the Indian Consumer Durables industry average (37.3x)

Price to Earnings Ratio vs Fair Ratio

What is SFL's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SFL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	59.4x
Fair PE Ratio	34.5x

Price-To-Earnings vs Fair Ratio: SFL is expensive based on its Price-To-Earnings Ratio (59.4x) compared to the estimated Fair Price-To-Earnings Ratio (34.5x).

Share Price vs Fair Value

What is the Fair Price of SFL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SFL (₹2646.7) is trading above our estimate of fair value (₹1281.23)

Significantly Below Fair Value: SFL is trading above our estimate of fair value.

Price to Earnings Growth Ratio

PEG Ratio: SFL is poor value based on its PEG Ratio (2.1x)

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Future Growth

How is Sheela Foam forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

28.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SFL's forecast earnings growth (28.4% per year) is above the savings rate (6.7%).

Earnings vs Market: SFL's earnings (28.4% per year) are forecast to grow faster than the Indian market (17.3% per year).

High Growth Earnings: SFL's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: SFL's revenue (13% per year) is forecast to grow faster than the Indian market (11.5% per year).

High Growth Revenue: SFL's revenue (13% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SFL's Return on Equity is forecast to be high in 3 years time (20.1%)

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Past Performance

How has Sheela Foam performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

16.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SFL has high quality earnings.

Growing Profit Margin: SFL's current net profit margins (7.3%) are lower than last year (9.8%).

Past Earnings Growth Analysis

Earnings Trend: SFL's earnings have grown by 16.4% per year over the past 5 years.

Accelerating Growth: SFL's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SFL had negative earnings growth (-8.6%) over the past year, making it difficult to compare to the Consumer Durables industry average (13.6%).

Return on Equity

High ROE: SFL's Return on Equity (15.6%) is considered low.

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Financial Health

How is Sheela Foam's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: SFL's short term assets (₹8.2B) exceed its short term liabilities (₹5.6B).

Long Term Liabilities: SFL's short term assets (₹8.2B) exceed its long term liabilities (₹4.1B).

Debt to Equity History and Analysis

Debt Level: SFL's net debt to equity ratio (14.8%) is considered satisfactory.

Reducing Debt: SFL's debt to equity ratio has increased from 12.8% to 24.1% over the past 5 years.

Debt Coverage: SFL's debt is well covered by operating cash flow (58.4%).

Interest Coverage: SFL's interest payments on its debt are well covered by EBIT (13.8x coverage).

Balance Sheet

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Dividend

What is Sheela Foam current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.16%

Forecast Dividend Yield

Dividend Yield vs Market

Notable Dividend: Unable to evaluate SFL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate SFL's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SFL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SFL's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as SFL has not reported any payouts.

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Management

How experienced are the management team and are they aligned to shareholders interests?

6.6yrs

Average management tenure

CEO

Rahul Gautam (68 yo)

26.17yrs

Tenure

₹39,799,000

Compensation

Mr. Rahul Gautam has been a Managing Director of Sheela Foam Limited (also knoenas Sheela Foam Private Limited) since April 1, 1996 and serves its Chairman and BR Head. Mr. Gautam is associated with Sheela...

CEO Compensation Analysis

Compensation vs Market: Rahul's total compensation ($USD503.73K) is about average for companies of similar size in the Indian market ($USD459.81K).

Compensation vs Earnings: Rahul's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: SFL's management team is seasoned and experienced (6.6 years average tenure).

Board Members

Experienced Board: SFL's board of directors are considered experienced (6 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/29 00:00
End of Day Share Price	2022/06/29 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31