Sheela Foam expects good sales in Diwali: Rahul Gautam, MD

Rahul Gautam, Managing Director, Sheela Foam Ltd, talks about his expectations from the festive season especially Diwali, international business and price hike plans among others during a candid chat with Swati Khandelwal, Zee Business. Edited Excerpts:

Q: Best wishes for Diwali. What trends are visible and what are your expectations from this festive season, especially from Diwali?

A: I feel, it should be very good and trends that were seen last month and in October suggests that the entire market has opened up and people have started coming out and are shopping. Especially, when it comes to our main item, mattresses, then it seems that while being at the home, people have realized that the amount of time that we are spending on should be of good quality and I like it. And, I want that this Diwali and the coming period should be good for the country as well as for me.

Q: Trends are looking good. So, do you expect that Diwali will be better than the last Diwali, if yes, then what kind of targets you are expecting if it comes to numbers?

A: Last Diwali was also slightly dampened as the economic conditions were not very strong that time, the trend was downward. It will be very good if it repeats this year as well because we are passing through a period April-May-June where the Corona’s impact was very high. So, I think, if this Diwali will turn like to last year’s then it will be a big achievement. 

Q: While going through your numbers it was seen that you have done well even in the international market. What has been the reason and can you tell us about the markets where you are getting a response and what kind of growth and expansion is expected in those markets?

A: We have our presence in two places in the international market and they are Australia and Spain. In the case of Australia, the market is limited and it is a matured market. But also, as I have said about the trend related to mattresses and sofas – and wherever our foam and mattresses are used – then there the results are good and surprising. First of all, people have enough money as they have saved the money that they were using on travelling and their government has also provided extra $1000 two times and they are spending it in the home improvement areas. As far as Spain is concerned, which represents the European Union, the trends are similar. At our place, we definitely felt a shortage of availability of the raw material and prices have gone up. But our good contacts helped us in maintaining a better availability of things at our place as compared to others. So, these two things have been better for both of our subsidiaries and it is doing well at present also. 

Q: You were talking about the price rise of the raw material. So, what impact can be seen in future? Do you have plans to increase the prices, if yes, then what can be the timeline and the quantum of increase?

A: As far as price is concerned then we try our best to increase it to the minimum level and to absorb as much as we can. As far as mattresses are concerned then there is no possibility of a price reversal in the segment. So being prudence we are trying to increase it by 2-5% and we have also done this. When it comes to raw materials, then the price has increased due to the supply chain as people never thought that the markets will recover at such a speed after the corona. That’s why the complete supply chain, whether it is refineries or ships or Polyol plants and TDI Plants, they didn't have stocks due to which there is a mismatch at certain places. The situation will take at least a month or two to end, so, I feel that it will end by December 15 to the end of December and normal supplies will start. Therefore, its impact will be for a minimum period and we have tried to pass-on the minimum to the level we can. 

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