Newly listed stock in focus after announcing strong revenue guidance for FY28

Synopsis: Wakefit​‍​‌‍​‍‌​‍​‌‍​‍‌ management indicated that the company would be able to grow significantly through the expansion of the furniture segment, with a plan to achieve Rs 1,000 crore furniture revenue by FY28, around 20% topline growth in the early years, and 500–600 bps margin enhancement over the next 4–5 ​‍​‌‍​‍‌​‍​‌‍​‍‌quarters.

Wakefit​‍​‌‍​‍‌​‍​‌‍​‍‌ Innovations is getting a lot of attention after the management revealed a bold plan to not only expand the furniture business but also to increase the speed of the overall growth and considerably raise the profit margins over the next few ​‍​‌‍​‍‌​‍​‌‍​‍‌quarters. In this article, we will dive more into the details of this.

With a market capitalisation of Rs 6,285 crore, the shares of Wakefit Innovations Ltd are currently trading at Rs 192 per share, 1.54 percent down from its listing price of Rs 195 per share.

Management Comments

Chaitanya​‍​‌‍​‍‌​‍​‌‍​‍‌ Ramalingegowda, co-founder and CEO of Wakefit Innovations, outlined a confident growth plan for the company. He emphasised the furniture segment as the main driver of both the margin and the growth of the company in the future. The management revealed that the continued expansion of the furniture capacity could propel the revenues to almost three times the current levels. By FY28, the furniture business alone is expected to generate around Rs 1,000 crore in revenue. The expansion is anticipated to be at the centre of deepening Wakefit’s overall profitability profile.

On a corporate level, the management anticipates the revenue to grow in the early 20 percent range. The growth will be supported by increasing scale and operating leverage. Wakefit intends to improve its margins by 500-600 basis points in the next 4–5 quarters. It cites sufficient room for expansion as the contribution of furniture increases. The company plans to maintain discipline in advertising spends at 7–8 percent of the revenue. The management sees this as enough to support the growth and, at the same time, keep the margins safe.

On the expense side, Wakefit mentioned that about 38 percent of its raw materials are sourced from overseas, and the procurement is done on an opportunistic basis in order to manage the costs. The management, while noting that short-term foreign exchange volatility is still a factor, is confident in its ability to handle currency fluctuations without significantly affecting the margins. 

About Wakefit

Wakefit Innovations has built a strong D2C brand in India by offering affordable, high-quality sleep and home solutions. Its early success with memory foam mattresses disrupted traditional pricing by cutting out intermediaries and focusing on online-first distribution.

Over the years, the company has smartly expanded beyond mattresses into furniture and furnishings, covering products like sofas, beds, wardrobes, and study tables. This wider portfolio allows it to address the complete home requirements of modern, value-conscious Indian consumers.

Wakefit’s digital-led model is now supported by a growing offline presence. With sales across 700 districts and 125 stores in 62 cities, the brand blends online reach with physical experience, strengthening trust, visibility, and last-mile customer engagement.

Wakefit has reported a revenue of Rs 1,274 crore in FY24, which is a growth of 29 percent as compared to Rs 986 crore in FY24. Over the last 3 years, the company’s revenue has grown at an attractive CAGR of 26 percent.

Regarding its profitability, the company reported a net loss of Rs 35 crore in FY24, as compared to a net loss of Rs 15 crore in FY24, Rs. 146 crore in FY23, Rs. 107 crore in FY22 and Rs 37 crore in FY21. The company is yet to turn profitable.

Written by Satyajeet Mukherjee

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