Kurlon Enterprise Limited

Summary

Kurlon Enterprise Limited is well-known for producing and selling a variety of sleep products, such as polyurethane foam, latex foam, and mattresses with rubberized coir. Kurlon is a well-known brand in the business thanks to its emphasis on innovation and quality.

About Company :

Kurlon Enterprise Limited is an Indian mattress manufacturer headquartered in Bengaluru, established in 1962. The company offers a wide selection of products, including foam, rubberized coil, spring, and therapeutic mattresses, bolsters, cushions, sofas, pillows, and other related items, to help customers get a better night's sleep.

Kurlon's Mission and Vision:

Kurlon's objective is to continuously develop comfortable, high-quality, and sustainable sleep solutions that improve people's quality of life and overall well-being worldwide. Our goal is to be the industry pioneer in offering all-inclusive sleep solutions.

Subsidiaries:

Kurlon Enterprises Limited has the following subsidiaries: Sirar Solar Energies (P) Ltd, Sevalal Solar (P) Ltd, Sirar Dhotre Solar (P) Ltd, Komfort Universe Products and Services Limited, Belvedore International Limited, Starship Value Chain and Manufacturing (P) Limited, Kanvas Concepts Private Limited.

Key Pointers of the company

1. Kurl-on, an Indian company founded in 1962, is a trailblazer in the Rubberized Coir mattress industry.
2. One of the most established and reliable mattress firms in India, providing a variety of home comfort solutions, such as polyurethane foam, home furnishings, RC, spring, and foam mattresses.
3. We specialize in premium and superior branded mattresses and serve retail and institutional clients, including hotels, hospitals, and hostels.
   exports goods to nations in Asia, including Nepal and Sri Lanka.
4. Acknowledged by the Indian Coir Board for exceptional achievement in developing the home market and exporting rubberized coir products.
5. In 2014, operations were moved to Kurlon Enterprise Limited (KEL), a subsidiary firm.
6. KEL has 12 manufacturing plants spread around India, with its headquarters located in Bengaluru.
7. Committed to innovation and client fulfillment, offering ease, comfort, health, and expansion.
8. Kurlon produces mattresses with more than 135 possible combinations.
9. The business runs twelve production sites in India. Kurlon guarantees effective delivery with a huge network of more than 50 warehouses and 4000 counters.
10. The business is dedicated to growth, innovation, and offering comfort, convenience, health, and well-being to its customers.

Awards and Recognition:

1. 49th National Safety Day Award: Recognized for exemplary safety practices.
2. The Brand of The Decade Award 2021-22: Received in the mattress category as a testament to our quality and innovation

Products of the company

1. Rubberized Coir Mattresses: Kurlon, an industry pioneer, provides a range of comfortable and long-lasting rubberized coir mattresses.
2. Spring mattresses: A selection of spring mattresses with superior comfort and support.
3. Foam mattresses: Premium foam mattresses that conform to the curves of the body to provide a good night's sleep.
4. Rebounded Foam: Specialised foam goods used in furniture and mattresses, among other purposes.
5. PU Foam: Products made of polyurethane foam with a range of applications.
6. Furniture for the Home: An extensive selection of furniture pieces, such as couches, beds, and chairs.
7. High-end soft furnishings: are those in the premium category that give any room a hint of elegance.

Industry Analysis:

Economic Scenario and OutlookIn PY 2021, the world economy rebounded significantly despite new COVID-19 variations.It is predicted that between 2022 and 2023, global growth will drop from 6.1% in 2021  to 3.6%.  Because of the rises in commodity prices brought on by the war, inflation is predicted to continue high.

Market Overview: 

Spring mattresses, PU foam, and Rubberized Coir make up the Indian mattress market. Infrastructure improvements and rising income levels are the main drivers of growth. It is anticipated that demand for luxurious, personalized mattresses will increase. Nowadays, mattresses are thought to be a sign of a person's quality of living.

Company Analysis:

Outlook on Future Prospects, Opportunities, Threats, Risks, and Concerns

1. The business is ideally positioned to benefit from the expansion potential in its industry.
2. Kurlon has overcome obstacles to get stronger and is actively looking for chances to grow.

Business Overview:

1. Kurlon is one of India's top mattress manufacturers, operating in three distinct categories.
2. The company's main goal is to support the mattress industry's growth in India.
3. Kurlon wants more and more people to use their products to live happy, healthy lives.

Financials

Key Financial Ratios      

1. Earnings Per Share (EPS): ₹ 0.98 per share - This ratio indicates the profitability of the company on a per-share basis.
2.     Return on Equity (ROE): 0.79% - ROE measures the company's profitability by revealing how much profit a company generates with the money shareholders have invested.
3.     Debt to Equity Ratio: 0.53 - This ratio indicates the proportion of equity and debt the company is using to finance its assets. A lower value suggests the company is less dependent on external borrowings.
4.   Net Profit Margin: 0.46% - This ratio represents how much of each rupee of revenue earned results in net profit. It provides insights into the company's profitability after all expenses are taken into account.

Analysis based on Financials :

1.        Revenue Growth but Profit Decline: While the revenue from operations increased, the company moved from being profitable to posting a loss, which is concerning.

2.        Increasing Financial Charges: The finance charges more than doubled, which might indicate higher leverage or cost of debt.

3.        Higher Depreciation: The increase in depreciation could suggest significant capital expenditures, possibly for expansion or modernization.

4.        Tax Burden: Even though the company made a loss, the current tax has increased. This needs further investigation.

5.        Negative Comprehensive Income: This includes not just the net income but also other factors affecting the company's equity. A negative value is generally not a good sign.

6.        Constant Dividends: Despite a significant drop in profits, the proposed dividend on equity shares remains unchanged. This could be a strategy to keep shareholders happy but might not be sustainable if profits don't recover.

Swot Analysis 

Strength :

1.  Diverse Product Portfolio: Kurlon offers a wide range of home comfort solutions, including mattresses, PU Foam, furniture, and high-end soft furnishings.
2. Strong Brand Recognition: Kurlon is one of the oldest and most trusted brands in India, synonymous with premium mattresses.
3.  Nationwide Presence: With 12 factories, 50+ warehouses, and a retail reach of more than 4000+ counters, Kurlon has a strong geographical presence.
4. Innovation and R&D: The company continuously adds value to existing products through a dedicated product development team.
5. Sustainability Initiatives: Kurlon focuses on environmental sustainability through initiatives like rain harvesting, using solar energy, and achieving zero carbon emissions.

Weakness :

1.   Low Profitability: The Profit After Tax for FY22 stood at ₹ 357.96   Lakhs, which is significantly lower compared to the previous year.
2.    Low ROE: The Return on Equity is 0.79%, which is relatively low and may not be attractive to investors.
3.    Limited Financial Ratios: The available financial data is limited, making it difficult to perform a comprehensive financial analysis.

Opportunities :

1.  Growing Market: The organized mattress segment is estimated to grow over 15% YOY, providing ample growth opportunities.
2.  Customization and Luxury Segment: There is increasing demand for customized and luxury mattresses, which Kurlon can capitalize on.
3.  ESG Goals: The company is consciously moving towards Environmental, Social, and Governance goals, which could attract socially responsible investors.
4.  International Expansion: The company is actively pursuing opportunities to scale up both organically and inorganically in India and internationally.

Threats :

1.      Market Competition: The home comfort industry is competitive, and Kurlon faces competition from both local and international brands.

2.     Economic Fluctuations: The company's performance may be affected by economic conditions, including inflation and interest rates.

3.     Raw Material Price Fluctuation: The company faced the worst impacts of higher input costs due to inflation, which could affect profitability.

Conclusion:

Kurlon, established in 1962, is a trusted name in the sleep solutions industry. Their diverse product range includes rubberized coir mattresses, latex foam, polyurethane foam, and more. Kurlon’s unwavering commitment to quality has solidified its position as a leader. The recent acquisition by Sheela Foam further highlights Kurlon’s prominence. Positioned for expansion, Kurlon aims to provide top-tier, sustainable sleep solutions. With an impressive presence in India and global aspirations, Kurlon remains a symbol of comfort, convenience, health, and progress in home comfort solutions