Ladies and gentlemen, good day and welcome to the Welspun Living 4Q FY 2026 post-result earnings conference call hosted by 360 ONE Capital Market. I now hand the conference over to Ms. Aradhna Jain from 360 ONE Capital. Thank you, and over to you, ma'am.
Thank you, Darwin. Good afternoon, everyone. On behalf of 360 ONE Capital Market, I welcome all participants and the management of Welspun Living to the 4Q FY 2026 con call. Without much ado, I'll hand over the call to Ms. Bharti Agarwal, Head Investor Relations, Welspun Living, to introduce the management. Over to you, Bharti.
Thank you, Aradhna. Good afternoon, everyone. On behalf of Welspun Living Limited, I would like to welcome you all to the full year and fourth quarter FY 2026 earnings call. Joining me on the call today are Ms. Dipali Goenka , Managing Director and CEO, and Mr. Manish Bansal, Chief Financial Officer. We hope you have had the opportunity to review the earnings presentation, which has been filed with the exchanges today and is available on our website. During the course of today's discussion, we will make references from this presentation. While there is no change in the disclosure, we have refreshed the presentation this quarter to better reflect the business narrative and strategic progress in a more intuitive manner. We will now begin with the opening remarks from the management, following which we will open the floor for a Q&A session.
Should you have any additional questions after the call, please feel free to reach out to us. With that, I would now like to hand over the call to Ms. Dipali Goenka. Over to you, ma'am.
Thank you, Bharti. Good afternoon, and thank you for joining us for Welspun Living's Q4 and full year FY 2026 earnings call. FY 2026 navigated pronounced external disruptions, tariff volatility, geopolitical tensions, and demand softness with Q4 marking a decisive sequential inflection driven by sharper execution and strengthening business momentum. Revenues improved quarter-on-quarter. Margins stepped up meaningfully. Cash flows remained strong and execution momentum is clearly visible entering FY 2027. Q4 revenue grew 7.7% sequentially. Q4 EBITDA margin improved to 10.8%, up 313 basis points quarter-on-quarter. Full year free cash flow generation of INR 956 crores. Net debt reduced by 52% year-on-year to INR 775 crores. What changed this quarter is very important. Volume stabilized with ease in U.S. tariff uncertainty and emerging FTAs creating stronger market access.
Cost actions taken through the year began to flow through. Strong growth momentum in our branded business. 44% year-over-year growth in Welspun and 19% year-over-year growth in Spaces. Management actions through FY 2026 were deliberate and disciplined. We protected customer relationships and focused on geographic diversification with our non-U.S. share expanding to 41%. We intensified cost discipline and optimized working capital, delivering structural cost efficiencies. Our investments in innovation, sustainability, and nearshore manufacturing continued. We ended the year on a positive note with the commencement of commercial production at our Nevada greenfield pillow facility on 31st March 2026. As we look ahead, our operating guardrails for FY 2027 are clear: driving profitable growth and margin recovery led by operating leverage and mix improvement. Navigating global market dynamics and macroeconomic volatility with agility and sharp execution.
Continued balance sheet strengthening with strong working capital discipline. Q4 was about stabilization. FY 2027 will be about scaling, profitability, and responsibility. Turning to our performance highlights. FY 2026 was marked by sharp external volatility driven by U.S. trade uncertainty and disruption from the West Asia conflict, which pressured freight, energy, and commodity costs across global supply. At the same time, a clear structural shift is underway with India strengthening its position as a preferred sourcing destination following progress on trade frameworks with the U.S., U.K., Europe, Japan, and Australia. The EU and U.K. together represent a home textile market of over $30 billion, where FTA structurally enhance India's competitiveness and create multi-year growth opportunities beyond the U.S.
Against this backdrop, our FY 2026 consolidated revenues stood at INR 9,468 crores, down 11.5% year-on-year to a period that I would characterize not as a reversal of our fundamentals, but as a year of external shock absorption. EBITDA margins for the full year stood at 9.1% reflective of a deliberate choice to protect customer relationships, capacity, and talent through an exceptionally difficult operating environment. The fourth quarter showed green shoots. Consolidated quarterly revenue grew 7.7% sequentially. EBITDA margins for the quarter stood at 10.8%, a meaningful sequential step-up of 313 basis points, reflecting both operating discipline and the benefits of sustained cost optimization efforts. Our home textile business remained impacted by cautious retail buying and tariff uncertainty, with FY 2026 revenues declining 11.2%.
India remains a stable sourcing destination with 45% share in cotton terry towels and 60% share in cotton sheets as per OTEXA. At the same time, we continue to focus on geographic diversification beyond the U.S. with expansion in share to 41% in FY 2026 across Europe, U.K., India and ROW. With emerging FTAs creating stronger market access and tariff competitiveness, our non-U.S. growth strategy becomes increasingly important in building a more balanced, resilient and future-ready global portfolio. The pillow, utility, and fashion bedding remain high potential categories. Our Ohio pillow facility continues to ramp up well, with utilization now at 60%, and we doubled the business this year to $27.5 million from $15 million in FY 2025.
We also partially commenced commercial production at our Nevada pillow facility in March 2026, further strengthening our local manufacturing presence and long-term play in U.S. sleep ecosystem. Another key strategic priority is strengthening our branded and consumer-faced portfolio, which contributed 19.3% of FY 2026 revenues and continues to improve the quality of growth. Our global brands accounted for 12% of our business and continue to deepen shares presence across key international markets. Christy delivered 15% growth in FY 2026, driven by strong U.K. performance, improving U.S. e-commerce traction, and sharper brand positioning and penetration. Our homegrown brand, Welhome, built around elevated comfort, design, and value, also scaled up meaningfully, delivering $9.4 million in revenues. With strong traction across North America and expansion underway in Japan, the U.K., China, and Taiwan, Welhome is well-positioned for a double-digit growth.
We're also seeing strong momentum in our institutional business through our brand Welspun Hospitality, with growing presence across marquee hospitality chains globally, including Hyatt, IHG, Wyndham Hotels & Resorts, and Marriott International. This channel strengthens our premium positioning, drives specification-led demand, and creates a strong bridge between B2B sales and B2C brand visibility. In India, our consumer brands, Welspun and Spaces, delivered strong momentum, growing 44% and 19% year-over-year, respectively, in quarter four, supported by stronger brand salience, premiumization, and sharper channel execution. Taken together, our branded portfolio is becoming a meaningful long-term growth engine, improving margin resilience, stronger customer stickiness, and a structurally superior business mix. India continues to be one of the structural growth stories for our business, and our domestic consumer business remains a key strategic growth engine.
In Q4 FY 2026, the business delivered an outstanding performance, with revenue growing 29.2% Y on Y and achieving EBITDA breakeven for the quarter. For the full year, domestic revenue stood at INR 657 crores, up 9% Y on Y, reflecting improving scale, stronger execution, a healthier business mix, and continued channel diversification. This momentum is being driven by strong performance of our Welspun and Spaces brands. Our domestic flooring business also continued its strong trajectory, growing 18% Y on Y for the full year, with healthy contributions from housing, hospitality, and institutions demands. This growth is further supported by our focused engagements with architects, interior designers, and project contractors, helping us strengthen specification-led demand. The broader India's macros remain supportive. Easing retail inflation and rising urban and rural disposable incomes provides a compelling tailwind for our domestic business.
We are investing ahead of this growth, deepening distribution, expanding our product range, and strengthening our brand equity. Our global flooring business saw the sharpest impact from West Asia logistics disruption and U.S. tariff headwinds through FY 2026, resulting in a 25.1% year-on-year revenue decline. Near-term performance has been pressured, the structural fundamentals of business remain intact. Our focus is on regional diversification across ANZ, Canada, and the Middle East, backed by strong customer partnerships with a meaningful recovery, particularly in soft flooring expected over the coming year. Our advanced textiles business operated in a softer global demand environment during FY 2026, with revenues declining 20% Y-o-Y to INR 452 crores, primarily due to volume pressure and slower export offtake.
At the same time, we secured important wins through high-value niche applications, including sustainable hygiene solutions, femcare, specialty wipes, protective apparel, and insulation, reinforcing our strategic shift towards value-added and differentiated categories. The medium-term outlook for this business remains constructive, with the U.K. and the E.U. FTA materially strengthening our access to key European markets for tech-technical textiles, specialty nonwovens and wipes, segments where quality, compliance, and sustainability are critical purchasing drivers. Sustainability and innovation continue to be two of Welspun Living's strongest competitive modes. In FY 2026, our sustainability leadership achieved strong global recognition, with Welspun Living being ranked number 1 globally in the textile, apparel, and luxury goods category. In 2025, S&P Global Corporate Sustainability Assessment with a score of 90.
We have also initiated a supplier-focused program, Step Zero, which aims to build a strong partnership with our suppliers who will play a key role in carbon mitigation in the entire value chain. Our global retailers increasingly making sourcing decisions based on ESG compliance, traceability, and long-term resilience. Our sustainability leadership becomes increasingly important. We remain firmly on track towards the FY 2030 commitments of 100% renewable energy and 100% sustainable cotton. Alongside this, our innovation portfolio, such as HydroCotton, GX Pillow, and Wel-Trak, continue to support premiumization and customer stickiness, contributing 20% of our business. During the quarter, we filed two new patents, taking our total IP portfolio to 50 patents, further strengthening our long-term differentiation and value creation. We enter FY 2027 with greater clarity and strengthened competitive position, supported by structural tailwinds that are steadily coming into play.
The benefits from FTAs are multi-year and durable. The U.S. retail environment is stabilizing, though some near-term overhang still persists. India domestic growth momentum continues to accelerate. Importantly, our operating model has been stress-tested and sharpened through a challenging cycle, leaving us better prepared to capitalize on the next phase of growth. FY 2027 will be a year of measured volume recovery and margin progression, and we expect to exit the year on a stronger growth trajectory, targeting double-digit growth. While structural tailwinds in the form of tariff easing and FTAs are coming into play, the global macro environment remains uncertain, with a continuously evolving geopolitical and trade landscape. Against this backdrop, our operating model has been rigorously stress-tested and strengthened positioning us to deliver a sharper growth trajectory with double-digit growth and EBITDA margins advancing into the teens in FY 2027.
With that, I will hand over to Manish to take you through the detailed financial performance. Thank you.
Thank you, Deepali, good afternoon, everyone. Let me take you through the detailed financial performance for Q4 FY 2026 and full year FY 2026. The quarter showed clear signs of sequential improvement across both revenue and profitability. Consolidated revenue improved by 7.7% over Q3, which indicates early signs of improving customer demand and better visibility as tariff uncertainty started easing. Q4 EBITDA margin stood at 10.8%, improved by 313 basis points sequentially from 7.7% in Q3. This was supported by better utilization, improved product mix, cost rationalization, and favorable forex realization.
FY 2026 consolidated revenue stood INR 9,468 crore, a decline of 11.5% year-on-year, reflecting the impact of U.S. tariff headwind, cautious retailers buying, and softened discretionary demand in our key export markets, especially during the first half of the year. Full year EBITDA margin stood at 9.1% compared to 13.6% last year. The margin dilution is primarily attributable to lower volume and tariff-related realization impact. As committed, we undertook focused action to strengthen governance and financial discipline, and I'm pleased to share the outcomes. Tighter controls led to a reduction in debtors and inventory by INR 345 crore, improved net working capital by INR 776 crore, driving a significant improvement in free cash flow to INR 956 crore, up 8.5x year-on-year.
This enabled a sharp reduction in net debts to INR 775 crore, down 52% from last year. Cash conversion cycle at 82 days improved meaningfully versus last few years, demonstrating stronger operating control across businesses. Total CapEx for FY 2026 stood at INR 472 crore, focused on productivity improvement, sustainability, and selective growth opportunities. For FY 2027, we expect CapEx in the range of INR 400 crore-INR 500 crore, largely towards modernization, automation and debottlenecking operations. We refer to our intimation dated July 30th, 2025 about board directors' approval for a capital expenditure of $13 million for setting up pillow manufacturing unit at Nevada. We are pleased to share that our Nevada pillow facility is in the U.S. partially commenced commercially production of 4.5 million pieces from March 31st, 2026.
This strengthens our local manufacturing presence in U.S. and support our long-term growth strategy in the sleep solution category. Reflecting our continued focus on disciplined capital allocation and long-term shareholder value creation, I am pleased to inform that board has approved buyback of equity shares of the company at price of INR 175 per share for an aggregated amount not exceeding to INR 252 crores and dividend recommendation at 10% per equity share for the financial year 2026, subject to shareholder's approval. We remain focused on improving margins, strengthening cash flows, and maintaining capital discipline as demand gradually normalize. With that, I will now leave the floor open for question and answers. Thank you very much.
Our first question comes from the line of Prerna Jhunjhunwala from Elara Securities. Please go ahead.
Thank you, a good improvement on a quarter-on-quarter basis. Wanted to understand the tariff situation now that, you know, there are various talks about tariff refunds and lower tariff to continue and stuff. What are your readings on tariff going ahead, and how should we assume the utilization levels improving for you for FY 2027 and moving forward?
Prerna, thank you for your question. First of all, I think let me just set the clarity on the tariffs, how it actually evolved. It started from, you know, say March, 10%, and then it moved to 25%, and then 28th August onwards it moved to 50%. The next February, it came back to 10%. Now, this whole thing of, you know, you know, the tariff refund that is coming through. There's a conversation that's happening, but I want to just give you a scenario here. Our more than 80% of our business is FOB, and where we basically, you know, have to work with the customers on the tariff refund and the other, the rest of it also, you know, there's conversation that is happening.
We let you know when the clarity gets better there. Now, when you talk about the utilization, as we spoke about our numbers that, you know, the growth that we're talking about, we definitely are seeing a utilization getting better in towels and sheets and even in bathrobes. The utilization will be above more than 86% across all the three categories as we go forward. Yes, things that way look better because even in the toughest times of tariff, we didn't lose any customer. The conversations we worked on partnerships and strategy.
That's very encouraging that 86% reversal to 86% in FY 2026. How do we see margins in light of increasing cotton prices? Are we getting price hikes from customers or tariff refunds actually play as a cushion for next year? Just wanted some clarity on that also, given cotton prices have increased sharply in the last 2 months.
It is not just cotton. I think let me also tell you, the cotton prices have gone up by 10%. The man-made fibers have gone up by more than 20%, and the crude by 40%. Overall, it all straightly impacts, you know, the whole commodity cost that we need. However, we'll work on our, as we spoke about this year also, we did lot of governance cost controls. That will play a very big role. Whenever these kind of things happen, and even in the tariff situation that we had, we talked about a 50/50% sharing. Here also conversations are happening with the customers, and wherever it is needed, we will discuss how the prices will have to be passed, Prerna.
Ma'am, Do you think that there will be some margin pressure continuing at least in the first half, given these cost escalations? A regular improvement in margins is doable, given tariffs are not there?
As I spoke about a double-digit growth in the top line and also kind of a teen, you know, a kind of a EBITDA margin, I think, that's what will sum up everything, Prerna, at the moment.
Okay.
There are a lot of factors in the terms of everything that will contribute to that, right?
Understood, ma'am. Last question is on flooring business.
Yeah.
How do we see traction over there? Where do we see the segment moving ahead in next two years?
Yeah. Here, Prerna, You know, I think the most vulnerable business to the whole, you know, Middle East and the others has been flooring. I must tell you, there has been, you know, soft flooring has seen an upside. You know, it has an, you know, positive margins potential 20% plus and a CAGR potential growth. You know, it is all owing to the commercial segment traction in U.S. Co-branded carpet tiles collections, and also our diversification in Australia and New Zealand. The soft flooring is something that we definitely see an upside there. A lot of opportunities are there in terms of innovation and focus.
The domestic flooring, where, you know, the businesses are growing, all the commercial opportunities that you see, the architects and the interior designers. Definitely here the growth is coming up to 30%, and we'll continue to grow this even better. The soft flooring and the domestic flooring definitely sees this. When we talk about the hard flooring, you know, we are rationalizing the portfolio and we're protecting our margins. A lot of work has been done here, Prerna, and we will look at that, you know, how we grow, you know, prudently in the terms of margins and also the top line.
Ma'am, on flooring, what are the kind of opportunities with FTA-driven countries? You mentioned about U.S. in this entire response, it would be great if we could understand what could be the opportunity in U.K., Europe eventually that could support this?
Yes.
accelerate this growth going forward.
You know, Prerna, as I spoke about Australia, New Zealand, Middle East, Europe, these all will open up in a big way. As you also know that our landscape of our hospitality and the commercial in America that we have penetrated, the same way we are penetrating into the commercial and the hospitality space in U.K. and Europe. That will also add on to our FTAs. You know, FTA will add on to the upside here in the terms of flooring.
Okay, ma'am. Thank you and all the best.
Thank you. Thank you, Prerna. Thank you.
Thank you. Our next question is from the line of Shraddha Agrawal from Asian Markets Securities. Please go ahead.
Yeah, hi. Congratulations, Dipali, on a good quarter and also appreciate the confidence you are giving for FY 2027. Just had two questions. One is, given the rising inflation in the U.S., how do you see that impacting retail demand in 2027? Against that backdrop, what gives us confidence of improvement in utilization levels to 87% plus? Don't you think that increasing inflation will have some impact on consumer demand?
Shraddha, very good question. First of all, yes, inflation could be up in the U.S. However, the retail demand is still, you know, very robust. We see that kind of a strong buy in the U.S. I think in the conversation that we spoke about, we have actually, you know, our non-U.S. markets have also, you know, contributing around 41% of our top line. Now with the FTAs, now as we see U.K. opening up, by, you know, June end, the U.K. FTA, you know, it happens by June end, so I think the second quarter we'll see that happening. The Europe will happen in January. We will definitely see the upsides of these kind of businesses as well, apart from the other rest of the world countries that we're looking at.
To your question, U.S. is the world's biggest, you know, consumption economy. With even where we are looking at the inflation, we will still see, you know, the growth there comparatively even to the last year, Shraddha.
Right. The second question is again on macros. With rupee-USD levels, USD rupee is now at 96. Are clients pressing us to pass on the rupee depreciation benefits or is there any change to our contractual terms with clients or is there any change in hedging policy and what is our current hedge cover and how should we look at hedging gains or loss assuming the current spot rate of 96 to continue into 2027?
Shraddha, our whole policies remain constant for years, and will remain there. Let me tell you, when you talk about the cost, I will say currency is at 9.6%. If you look at the others, crude oil is at 40% up, cotton is at 10%, yarn terry towel is up 20%-30%, yarn bedsheet is up 20%-30%. The dyes and chemicals are up 20%. The manmade fibers and the polymers are up 20%. You are setting off that cost. Customers totally understand that. We completely are talking with them in close conversation around what is the kind of net delta that we're looking at. There's no net delta gain even with the rupee where it is.
We are working and we'll work on, you know, how we can look at sharing the costs as well.
Right. Secondly, in terms of utilization for our utility bedding plant in U.S.
Yes.
The first plant is already operating at 60% utilization. How should we look at the cadence of utilization improvement for the first plant and the partial beginning of ramp-up of the second plant? How should we look at the ramp-up there?
First of all, let me just give you two scenarios. When we talk about both the pillow plants, they are One is in the Midwest. One is in Ohio, the other is on the West Coast. These are bulky products. They will need, you know, they have to be closer to the DCs and the warehousing of our customers. They both will have the demands accordingly. Ohio is at 60%, which will definitely ramp up ahead. Also with Nevada, along with manmade filling that we're going to do, we're also going to do natural fiber. That will also add on a category and a kind of an upside on our, you know, UBR also.
Right. What is the kind of potential revenue expected from the Nevada facility in 2027?
Yeah, they literally will double. I'll tell you, this year we did around $27 million. Next year we tend to double, and we are talking about $60 million. That's the kind of, you know, kind of a visibility that we are seeing for the next year.
Got it. Sure. Thanks, Dipali, and wish you all the best. Thank you.
Thank you, Sharda. Thank you.
Thank you. Our next question is from the line of Anand S. from Avendus Spark. Please go ahead.
Hey. Hi, ma'am. Thanks for taking my question. Just wanted to understand a bit on the medium-term revenue aspirations that we had in terms of, let's say an INR 15,000 crore kind of a number.
I understand why the prospects in between have changed. How are we looking at that number currently? That is one. In terms of which segment we are looking to, you know, drive the growth for, let's say in the next couple of years. That's my second question. Possibly one other in terms of what's the peak revenue, you know, potential that we have in our existing capacities, and what's the CapEx that we need to achieve that INR 15,000 crore kind of a number? Broadly.
First of all, when you talked about our INR 15,000 crores owing to the current, we look at next 3 years that we will achieve these numbers. In the current optimized capacity that we're looking at, we can move up to around 11,500-12,000. That's where we are looking at it. When we talk about the growth, I think, let me tell you, we are the leaders in bath category across and now present in more than 50 countries. We would take this and with the FTA opportunity, we want to see our towels across, and that's a great opportunity of growth that we're looking at. Our sleep sequential system that we have created for pillows, which actually is as big category as towels, we'll again see kind of an upside there. These are important categories.
The other growth will come in from our brands. I think India is at an inflection point. I know right now the per capita consumption where it looks like, I think as we go forward, we definitely will see an upside here. Our target towards INR 1,000 crores is absolutely, you know, spot on here. We will see that growth happening here. Along with our brand Welhome and Christy, which is a premium U.K. brand, which actually is growing and has having a good robust footprint. We'll see a good traction in brands as well. This is where we are seeing our next footprint happening.
That's helpful, ma'am. Thank you.
Thank you.
Thank you. Our next question is from the line of Shweta Sharma from Arihant Capital. Please go ahead.
Thank you so much for the opportunity. I hope I'm audible.
Yeah. Yeah, go ahead.
Yeah. Ma'am, we saw a domestic consumer business, an impressive growth in Q4. While the global remains mixed, are you seeing signs of restocking from major U.S. and Europe retailers for the upcoming holiday season? Is the current demand still primarily driven by replacement cycle rather than expansionary inventory building?
See, I'll tell you 1 thing. We are looking at kind of a reasonable growth next year. As I spoke about in my speech as well, that our top line will grow by a double-digit, and that's what we are maintaining across the globe. Indian market will again grow at a rate of around 26%-30%. That's what we're also maintaining. We will see this kind of a growth coming in from whether it's United States of America or U.K., Europe. I think the FTAs. There you will see most of the FTAs opening up. U.K., as I spoke about, is already right around the corner. Europe by January end. I think more and more FTAs opening up could be a great opportunity for us as well.
Okay. With the new FTAs in place, what's the strategy for soft flooring in the U.K. and Europe? Do you expect this segment to achieve margin parity with the core home textile business by the end of FY 2027?
you know, both businesses are very different. However, we definitely will have an advantage with the FTAs opening up in U.K., Europe. We already are working with Middle East, Australia, New Zealand. yes, we definitely will have that upside. The margin parity is round about the same.
Okay. From India and U.S. trade agreement are reducing tariff from 50% to 18% in February. How much this benefit is being retained as margin expansion compared to passed on to retailers to regain the market share lost during the high tariff period?
You know, we didn't lose any market share, first of all. We retained each and every customer, so that is something that is there. I think it moved from 50% to 10%. Now the BT is having whether it's going to be 15 or 18, that conversation is happening. Always it is a conversation with the customers as partnership. It's going to be definitely a 50/50, and that's the conversation we've already been having with our customers on.
Okay. Okay. Thank you so much, ma'am. That's all from my side. Thank you.
Thank you. Thank you so much.
Thank you. Our next question is from the line of Aradhna Jain from 360 ONE. Please go ahead.
Hi. Thank you for the opportunity, and congratulations on the good set of numbers. Just couple of questions from my end. One, to continue with the previous participant's question on the U.S. tariff side. We are at 10% today. The Section 122 is applicable, I guess, till June end. After that, you're saying maybe we go to 15 or 18. There's also Section 301, which has been initiated on a lot of countries, including India. Say, if that also gets concluded, because of all of this uncertainty, have we seen any meaningful change in the ordering behavior from, say, the larger retailers over the last 2, 3 months and, you know, and the tariff-related discussions globally? That's my first question.
No. First of all, this year till July 24th is our 10% that we're talking about, and the conversation's still happening with the governments regarding the BTA that is happening. One thing is that we are in close conversation with the customers practically every day in America since our team's already there on the ground. We, we are not seeing any kind of a disruption there. That way I think we are pretty okay with that. Anything else? In fact, I know, I mean, as I spoke about our utilization also, our utilization is around 86% and above, so this also is contributing to that factor of utilization increase.
Understood. Second is, there was already a discussion on the cotton and yarn price increase. Ultimately, we as a downstream player, we'll have to either, you know, take the hit, by ourselves or pass it on. Is the industry currently able to pass on the raw material inflation smoothly, or does the weak global demand backdrop limit the sort of pricing power?
There are conversations that will happen with customers, and there is definitely that opportunity that we will work together to, you know, share the load. That is something that we are looking at with our customers. That will have to be shared, and the conversations are on accordingly.
Understood. Lastly, any guidance on the EBITDA margin side? By when do we expect to get closer or back to the 14%, 15% kind of range at the EBITDA level?
Despite the macro factors that you are seeing today, and you know that, you know how tough these are, we are looking at a double-digit growth and a kind of a teen EBITDA, you know, in our next year's plan. That actually speaks it all.
Understood. Thank you so much.
Thank you. Thank you.
Thank you. Our next question is from the line of Shirish Pardeshi from Motilal Oswal. Please go ahead.
Yeah. Hi, good afternoon. Thank you for the opportunity. On the slide 10, I'm reading, global B2B and others is contributing 52% of the business. Now YOY it has declined about 12%. 2 questions. Have we lost any customer here, or it's a linear decline because they are sitting in U.S. and everybody is declining in terms of their ordering?
No, there's no loss of any customer. It is the kind of a demand decrease because there was uncertainty, right? Once the tariff was 10%, the another 25%, then India becomes a 50%, right? Hence, you know, there was this uncertainty flavor that was there, which actually was, you know, there was a lot of communication that happened with the customers and that's where it is. There's no loss because of any customer losses.
Okay. When you look at the past 12 months and next 12 months forward, this INR 4,400 crore business will see what legs, what run speed, for FY 2027?
We actually are looking at, you know, when you're looking at a double-digit growth here, and I spoke about it earlier as well. We are also not just seeing the U.S. market grow. As I spoke about our U.K., Europe contributing around 41% this quarter, which will also be an opportunity because the FTA is Like U.K. will happen in June end and Europe will happen in January end. I think that's something that we are seeing as a potential opportunity as well.
I heard that, Dipali, but the question here is that you have Ohio and Nevada coming up and scaling up.
Yeah.
What will be the U.S. growth you are penciling in?
No, U.S. will be primarily contributing to the growth. Pillows is already, as I spoke about, this year we clocked around $27 million. We are going to clock double, $60 million actually, literally next year on our pillows. Ohio and Nevada will contribute to that. USA definitely is going to be a very big one in the contribution of a growth, of a double-digit growth as we see at Welspun Living Limited on B2B Global.
Okay. Given the RM challenges and tariff situation, what is the margin we would be doing? I mean, I don't know whether you share that in 26. This 52% business, I would assume that would have a EBITDA margin of about 5%-6%. I don't know whether it is right or wrong. Correct me.
No.
How does this pan out in FY 2027?
See, the thing is, as I spoke about, we'll have a double-digit growth and a teen EBITDA, so that at least speaks it all. We are not 5%-7%. We should do better, honestly.
Okay. Last question on the flooring business, which is about INR 700 odd crore, B2B and branded.
Yeah.
Yeah.
Yeah.
I mean, this business, to my best understanding, has a lot of momentum, and we also have a capability. Somehow this business has not been able to scale up. I don't know what is your expectation, it has not done well over last two, three years.
Next 2, 3 years, if we build this number, what kind of business we can see that?
Well, you know, flooring, INR 1,000 crores kind of a number we are talking about right now. We are talking about soft flooring completely growing. I think that's where we'll see a great opportunity because there's a potential even with the FTAs that are opening up. Only the hard flooring bit which we have, which is a very small part of it, we are controlling very prudently and also looking at kind of a margin control there as well. We are good to go on the soft flooring and with the FTAs opening up in U.K., Europe and also in the Middle East and Australia, New Zealand, and also the India market, as I spoke about, has grown 30% and we're also anticipating it to grow next year at 30%, is a good opportunity here.
You are right, flooring has seen the biggest impact due to the macroeconomics more than anything else.
Okay. Just last question, if I could squeeze in. This INR 252 crore buyback-
Yes.
-how one should look at the capital allocation, because we also have a debt of about INR 700 odd crore. Next 2, 3 years, is there any guidance you can give how we should be looking these numbers?
Sure. Manish?
Hi, Suresh. Manish here. Thank you for the question. Basically, as I mentioned, this is coming out from our cash. You know, in this year we have done well in terms of our cash flow manage working capital management, and we will continue to do that. We are looking, in ideal world, next year, debt-free company. A net debt zero company. Unless we plan any additional CapEx or any special requirement, but otherwise if all goes well, then we will be net debt zero company next year.
All right. Thank you, Manish, and all the best.
Thank you. Thank you.
Welcome.
Thank you. Our next question is from the line of Ronak Shah with Equirus Securities. Please go ahead.
Yeah. Thanks for the opportunity. My question is regarding the advanced textile segment. Though it is a relatively smaller segment in our overall piece, but how you are seeing the growth rates and the opportunity in this business, considering there is so much noise in the street regarding this?
advanced textiles, you know, we are actually moving from the commoditized product to value-added offerings. We primarily focus on consumer segment here, and we are going to look at a kind of a EBITDA steady state of around 20% here. Our focus segments will be hometech, medtech and Protech and Indutech. Of course right now in 2026, we secured strong wins across sustainable, you know, diapers, femcare, speciality wipes, protective apparel and jacket insulation. I can just sum it up by saying that advanced textiles will be focused on innovation led positioning. As you know, the company also has 50-plus patents. There's a lot of strong product development happening here as well.
Understood. Understood. My second question is regarding in case, company is coming up with any sort of M&A opportunity, what will be the space, you will be keep focusing on?
That's something we'll have to be seen, because as you have literally seen that our opportunities also in the brands that we are working in globally, I mean our own brands that we have. We have opportunities for, you know, growth in different countries. Let's see. These are all open-ended, and we are open to those opportunities, actually.
Understood. Understood. That's it from my side. Thank you.
Thank you so much.
Thank you. Ladies and gentlemen, if you wish to ask questions, you may please press star and one. Our next question is from the line of Jashim Kitani with JFK . Please go ahead.
Yeah. Hi, ma'am. Good set of numbers comparing the previous quarters. One question that I wanted to ask that, I think in the last con call, you had talked about entering the GCC region as well, or I think you're already operating there.
Yes.
Yeah. Due to this war impact, how much of the business impact do we see over there? In general, due to the Strait of Hormuz closure, so what is the other impact that we are seeing?
GCC actually is 2% of our revenue. Most of the businesses are FOB. Here, you know, that actually is something, we'll wait and watch till this whole clears up. The impact on our business is very, very minimal.
Okay. Got that. What about the export that we're doing from to the other countries? Will that be impacted due to the closure of the strait?
No. If you remember, we also had the Red Sea issue and, you know, the whole, there's always been that thing of Cape of Good Hope. It goes around the Cape of Good Hope, so it takes 15 to 20 days, and I think the whole trade and commerce has been working accordingly for the long time as well. I think we're all used to that now. That's what will continue here.
All right. Okay. Okay. One more question what I wanted to ask is, so about the facilities that we have in U.S.A.
Are we planning to, you know, expand aggressively or, the guidance that you gave that is what we are planning as of now?
Right now the opportunities that we are You know, we have these 2 own organic facilities that we have put up, which are absolutely state-of-art. Ohio and now Nevada, which commissioned on 31st March. We are going to look at it. Plus we have lot of partnerships there whom we are working with there, not only in U.S., but also in Canada. We are looking at it, and it's not only in retail, but also in hospitality. We are very focused in what we are doing. As I've said, we did $27.5 million this year. We're doubling it to $60 million next year. That's where, and we'll continue to grow this.
Our goal will continue to be adding value-added products, and better and best category more than anything else, and focus on sleep as a category, which will not only be pillows but also the utility bedding.
Perfect, ma'am. Thank you. I'll get on the queue, and all the best to you.
Thank you so much.
Thank you. Our next question is from the line of Hemant Shah with Enam Asset Management Company. Please go ahead.
Yeah. Thank you for the opportunity. Two questions on the domestic business. This quarter saw a robust growth. What has led to the growth in both the B2B and branded business? Second is, for FY 2027, on the domestic online business, do you see growth coming from that business as well? Or would it be the offline business that will help grow the branded domestic business?
India, actually, it continues to be the bright spot for us in the global economy that we are, you know, talking about. Both brands. Like, Spaces actually grew 19% in fourth quarter, and Welspun grew 44% in the fourth quarter. We are absolutely focused. The channels are very, very different here. One is your, you know, your general trade, the other is your modern trade, the other is your regional trade, and the other is your commercial and hospitality chains that we have. This is all offline. When you talked about e-commerce, I think the focus is on quick commerce and also in e-commerce to that extent. I think the India is a very mixed market. The mom-and-pop stores really rule the roost here.
We'll be focused on, you know, the offline and online as the opportunities come in, and we will have our own. We also have our own D2C, you know, so, brand, branded, exposure. We are working on that as well.
On the domestic B2B side?
B2B, all hospitality. We are working on the hospitality chains. As you know, we are present globally. We have great partnerships in United States of America, UK, Europe, and those are the brands also that are coming in here. That is again a very good opportunity for us. The religious tourism, which is growing at a rate of 20%, is again a very good opportunity for us. The B2B is again going to be a very important aspect. That's what it will be. It's the brands. That's your B2C and your B2B and D2C.
Thank you. That's it for my side.
Thank you.
Thank you. Our next question is from the line of Prerna Jhunjhunwala from Elara Securities. Please go ahead.
Hi. Thank you for the opportunity. Wanted to check on cotton inventory. How many months of cotton inventory do we have?
We have an inventory cover till October. We are covered, primarily, till October. We'll continue to buy yarn when we require, a little bit here and there. Till the next season comes, that's what we have.
Okay. What is our hedge position today? Are we maintaining that 65/35 ratio or?
Yeah
we've changed and moved on?
That's the thing. No, no, Prerna. That's what we maintain as a group at Welspun World. We maintain that across all our companies, group companies.
Understood, ma'am. Thank you and all the best.
Thank you. Thank you, Prerna.
Thank you. Our next question comes from the line of Rohit Ohri with Progressive Shares. Please go ahead.
Hi, Dipali. 2 questions.
Hi
of this, total turnover that we have, how much percentage or, what value would you give to premiumization?
If we talk about it, you know, 22% of our contribution comes in from innovation. As you saw our brands also grow, that again is a, you know, important. Our branded business was around 19%. Definitely that's again a good opportunity for us. These are important aspects of what we are looking at our growth that is coming in.
Mm-hmm. On the ROC, do you have any guidance to share with us for the next three years or so?
Yeah. You know, ROC will continue to improve. This year, you know, has been a challenge one.
I know it was, but, you know, we'll come back to where we were and in fact better it as we go forward, and that is something that we are seeing, and we are very positive about it.
That growth, would be, could be.
Say about, around more than 15%.
Okay. That's going to be asset heavy or asset light?
ABI asset light right now.
Okay, okay. Those were the two questions. Thank you for answering my questions.
Thank you.
Thank you. We have no further questions, ladies and gentlemen. I would now like to hand the conference over to the management for closing comments.
Thank you, Robin. FY 2026 was a year that tested our resilience. We chose to protect what matters most, our people, our customer relationships, our capacity, and our brand equity through a difficult cycle. That was the right choice, and the early green shoots in Q4 FY 2026 validate that view. While the global macro environment remains fluid and near-term uncertainties persist, the structural outlook is turning more positive. India's evolving FTA architecture creates a strong long-term advantage, while the West Asia situation remains uncertain and requires close monitoring. At the same time, India's domestic consumption momentum continues to strengthen. At Welspun Living, we enter FY 2027 with a balance sheet strength, operational discipline, brand equity, and customer relationships to emerge as a stronger, more valuable business. We are not just managing through this moment, we are positioning to lead the next chapter.
Thank you for your continued trust and confidence in Welspun Living. We look forward to a constructive conversation. For any further queries, please feel free to connect with the investor relations team. Thank you.
Thank you. On behalf of 360 ONE Capital Market, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.