Welspun Living Ltd (WELSPUNLIV) Q2 FY27 Results Analysis: EBITDA Margin Expands 604 bps, Net Debt Hits Zero

Cofacto Research Published October 30, 2026 3 min read

Positive

Welspun Living Ltd's Q2 FY27 numbers came in strong, with revenue of Rs. 2,838.12 Cr (+16.27% YoY) and PAT growth of +1041.72% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quick Details

Results date	October 30, 2026
Revenue (Q2)	Rs. 2,838.12 Cr (+16.27% YoY)
PAT (Q2)	Rs. 169.66 Cr (+1041.72% YoY)
EBITDA margin	12.88% (+604 bps YoY)
EPS (Q2)	Rs. 1.86 (+1330.77% YoY)

Quarter Snapshot

Q2 FY27 delivered 16.27% YoY revenue growth with EBITDA margin expanding 604 bps YoY to 12.88% despite the Vapi flood, and the net-debt-zero target was met two quarters early with H1 FCF of Rs.950.04 cr. Home Textiles margin at 12.02% still trails management's 15-16% band, and the quarter's margin benefited from an inventory drawdown that reverses on restocking. FY27 guidance on revenue and margin remains on track, with Vapi restoration and Q3 cotton restock as the swing factors.

Management Guidance vs Delivery

What management said	Where	What happened	Verdict
Double-digit consolidated revenue growth, FY27	reiterated on the Q1 FY27 earnings call despite the flood	H1 +19.83% YoY	On Track
EBITDA margin "low teens", FY27	Q1 FY27 call: "maintaining margins in the low teens"	H1 12.70%; Q2 12.88% (management basis)	On Track
Home Textile segment EBITDA margin 15–16%	Q4 FY26 call: "Home textile will maintain the 15% to 16% in EBITDA" (open-ended)	12.02% in Q2	Below the band this quarter
Net debt zero by FY27	Q4 FY26 call	≈nil at Sep-26 (8.97; net cash 1.55 incl. bank balances)	Met, ahead of schedule
US pillow revenue to double to USD 60 Mn	Q4 FY26 call	2.4x YoY in Q2; both facilities operational — USD run-rate not disclosed	On Track
Domestic business Rs.1,000 Cr	Q2 FY26 call, reiterated Q1 FY27	+28.2% YoY; brand +37% (absolute not disclosed)	On Track
Capex Rs.400–500 Cr FY27	Q1 FY27 call	151.33 in H1 (consolidated cash-flow statement) — H2 acceleration needed	Stretch
ROCE low teens during FY27; >15% growth over 3 years	Q4 FY26 call	12.7% (management-reported)	On Track

Key Investment Insights

Key Positives

Revenue grew 16.27% YoY to Rs.2,838.12 cr; H1 revenue +19.83% YoY
Management-basis EBITDA margin expanded 604 bps YoY to 12.88%, a fourth consecutive quarter of expansion despite the Vapi flood
Flooring revenue re-accelerated (+19.29% YoY, +15.30% QoQ) with PBDIT margin of 10.83% vs 2.07% a year ago
Domestic business grew 28.2% YoY (Welspun brand +37%); US pillow business grew 2.4x YoY with both US facilities operational
Net debt reduced to Rs.8.97 cr (net cash Rs.1.55 cr incl. bank balances) from Rs.769.94 cr at March-26, meeting the FY27 net-debt-zero target two quarters early
H1 CFO of Rs.1,101.37 cr (3.31x PAT) and FCF of Rs.950.04 cr
Finance costs fell 21.80% YoY to Rs.33.89 cr
Rs.125 cr on-account insurer payment received for the Vapi flood; deferred tax credit of Rs.7.16 cr makes the net post-tax flood impact broadly neutral

Risk Factors

Home Textiles PBDIT margin of 12.02% remains ~300 bps below the 15-16% band management said it would maintain
Sequential revenue momentum slowed to +1.53% QoQ due to the Vapi plant outage from July 23, 2026
Cost of materials +25.06% YoY and purchases of stock-in-trade +102.35% YoY outgrew revenue growth of +16.27%
Q2 margin was flattered by an inventory drawdown of Rs.241.79 cr (sales ran off stock while Vapi idled), which reverses on restocking
Capex of Rs.151.33 cr in H1 runs below the Rs.400-500 Cr FY27 guidance, requiring H2 acceleration
YoY growth multiples are flattered by lapping a tariff-depressed trough (year-ago PAT of Rs.14.86 cr)