📰 Welspun Living Q2 FY2025-26 Results: Revenue Falls 16.4% YoY to ₹2,456 Cr, PAT at ₹13 Cr Amid US Tariff Headwinds
Welspun Living Q2 FY2025-26 Financial Highlights
Welspun Living Limited, one of India’s leading textile and home solutions manufacturers, released its financial report for the second quarter (Q2) of FY2025-26, showing a 16.4% year-on-year decline in revenue and a sharp fall in profitability due to external trade challenges and weaker export demand.
For the quarter ended September 30, 2025, the company reported consolidated revenue of ₹2,455.7 crore, down from ₹2,873 crore in Q2 FY2024-25. Sequentially, it was up about 7.3% from ₹2,289.5 crore in Q1 FY2025-26, reflecting gradual recovery in domestic markets.
The company’s EBITDA (earnings before interest, taxes, depreciation, and amortization) stood at ₹168.1 crore, translating into a single-digit EBITDA margin. Net profit (PAT) dropped significantly to ₹13 crore, compared to ₹201 crore in Q2 FY2024-25.
Despite the downturn, the management emphasized that the company’s fundamentals remain strong, with net debt reduced to ₹1,570 crore from ₹1,832 crore a year ago.
📊 Quarterly Performance Comparison — Welspun Living Ltd
| Metrics (₹ crore) | Q2 FY2025-26 (Jul–Sep 2025) | Q1 FY2025-26 (Apr–Jun 2025) | Q2 FY2024-25 (Jul–Sep 2024) |
|---|---|---|---|
| Revenue from Operations | 2,455.7 | 2,289.5 | 2,873.1 |
| EBITDA | 168.1 | 254.3 | 420.6 |
| EBITDA Margin (%) | 6.8 % | 11.1 % | 14.6 % |
| Profit After Tax (PAT) | 13.0 | 89.3 | 201.0 |
| Net Debt | 1,570.3 | 1,612.9 | 1,832.3 |
Source: Company filings, BSE announcements, and investor presentation (Q2 FY2025-26).
Revenue Decline Led by Export Headwinds and Tariff Overhang
The revenue decline was primarily driven by a slowdown in export markets, especially the United States, which contributes a large share of Welspun’s total sales. The company cited “US tariff uncertainty” as the key factor impacting order inflow and retailer confidence in the home textiles category.
Exports fell by ~15.4% year-on-year, while domestic revenues showed relative resilience, declining just 3.7% YoY. The domestic consumer business contributed positively, supported by retail and institutional demand.
“Global demand volatility and tariff-related concerns affected Q2 performance, but our domestic business and flooring division continued to grow steadily,” said the company’s Managing Director, in the post-results commentary.
EBITDA and Profitability Impacted by Mix and Input Costs
The company’s EBITDA fell to ₹168 crore, marking a 60% YoY decline, with EBITDA margin contracting from 14.6% in Q2 FY25 to 6.8% in Q2 FY26.
The margin compression stemmed from:
Unfavorable product mix due to lower export contribution.
Operating deleverage caused by reduced factory utilization.
Elevated input and logistics costs, especially in energy and packaging.
Still, cost optimization measures helped limit the downside, and management reiterated its focus on improving gross margins through product innovation, operational automation, and supply-chain efficiency.
PAT Declines on Exceptional Factors
Welspun Living’s PAT plunged to ₹13 crore, down from ₹201 crore in Q2 FY2024-25 and ₹89 crore in Q1 FY2025-26.
The decline was driven by lower operating income and currency fluctuations in export markets. However, the company managed to maintain positive operating cash flow, with strict working capital control and debt reduction initiatives.
Business Segment Performance
🏠 Home Textiles Division
The home textile segment — which includes bed linen, towels, and bath products — remained the company’s core business but saw muted performance this quarter.
Export orders were postponed or delayed due to tariff uncertainties in the US.
Domestic institutional demand stayed stable, supported by hospitality and retail segments.
🧱 Flooring Division
The flooring segment continued to outperform, with revenue rising to ₹181 crore in Q2 FY26.
The company noted that flooring exports to the US and UK grew modestly, and domestic projects contributed strongly.
Management expects double-digit growth in flooring for FY2026, driven by demand for luxury vinyl tiles and engineered floors.
🧵 Advanced Textiles and Technical Fabrics
Advanced textiles — used in filtration, hygiene, and industrial applications — saw a 19% YoY decline, primarily due to global destocking trends.
However, management believes this will recover in the coming quarters as inventories normalize and institutional orders revive.
Management Guidance for H2 FY2025-26
Welspun Living’s management struck a balanced yet optimistic tone for the second half of FY26, focusing on margin recovery, debt reduction, and new product launches.
Key strategic priorities for H2 FY26:
Cost Rationalization: Tight cost control and better operating leverage as demand stabilizes.
Domestic Growth Focus: Expanding in home furnishing retail and flooring categories.
Innovation & Sustainability: Targeting 25% of total sales from “innovative and sustainable” products by FY27.
Debt Management: Reducing net debt-to-equity ratio to under 0.5x by FY27.
Digitalization: Strengthening e-commerce and D2C channels under the “Spaces” and “Welspun” brands.
“We remain confident in our long-term strategy. The US market volatility is temporary, and our diversified portfolio — across flooring, advanced textiles, and branded retail — positions us for recovery in H2 FY26,” said Dipali Goenka, CEO & Jt. MD of Welspun Living.
Financial Health: Debt and Cash Flow
One bright spot in Q2 FY26 was Welspun Living’s improved balance sheet.
Net debt decreased to ₹1,570 crore as of September 2025, compared to ₹1,832 crore in the previous year.
The company maintained a healthy interest coverage ratio of 5.1x and continues to generate positive operating cash flow.
This improvement came through disciplined working capital management, with inventory and receivables optimized to match slower export cycles.
Comparison Summary: Q2 FY26 vs Q1 FY26 vs Q2 FY25
| Parameter | YoY (Q2 FY26 vs Q2 FY25) | QoQ (Q2 FY26 vs Q1 FY26) |
|---|---|---|
| Revenue | ▼ –16.4% | ▲ +7.3% |
| EBITDA | ▼ –60.0% | ▼ –34.0% |
| PAT | ▼ –93.5% | ▼ –85.4% |
| EBITDA Margin | ▼ –780 bps | ▼ –430 bps |
| Net Debt | ▼ –14.3% | ▼ –2.6% |
Analyst View and Market Outlook
Market analysts remain cautiously positive on Welspun Living, emphasizing that the current quarter reflects external macro headwinds rather than structural weakness.
Brokerages noted that the company’s domestic business and flooring division are resilient growth drivers, while global demand normalization will likely aid FY26 recovery.
“We expect gradual earnings recovery from Q3 FY26 onward as US demand stabilizes and cost optimization measures bear fruit,” said an analyst from Motilal Oswal Financial Services.
Welspun Living also continues to strengthen its ESG credentials, focusing on renewable energy integration and sustainable cotton sourcing — initiatives that align with global retail partners’ sustainability mandates.
Risks and Watchpoints
Tariff & Trade Uncertainty: Continued US import duties on textiles could delay order recovery.
Global Retail Demand: Sluggish demand from large retailers may prolong revenue pressure.
Currency Fluctuations: Volatility in INR/USD impacts export margins.
Raw Material Prices: Cotton and energy cost spikes could further compress margins.
Execution Risks: Timely diversification into flooring and domestic channels remains critical.
Conclusion: A Transitional Quarter for Long-Term Growth
Welspun Living’s Q2 FY2025-26 results mark a transitional quarter — challenging externally but strategically resilient internally. Despite revenue contraction and profit decline, the company has continued to strengthen its balance sheet, invest in innovation, and expand its domestic presence.
The management’s focus on operational efficiency, sustainability, and debt reduction underpins long-term confidence. Once US tariffs normalize and global demand rebounds, Welspun Living’s diversified portfolio — spanning textiles, flooring, and advanced materials — positions it to regain momentum and profitability.
In short, Q2 FY26 is a reminder that even amid global headwinds, Welspun Living remains one of India’s strongest and most future-ready textile players.
Related Articles
