SFLSheela Foam Limited Forensic Risk Analysis

Furniture Home Furnishing
Risk ClassWatch
Market Cap₹6,087 Cr
Primary DriverGovernance
Flagium AI Risk Score
Early signs of stress detected. Not yet widespread, but initial deterioration is visible.
20 / 100
-5 QoQ
Improving
Sentinel Insight

Financial profile remains stable for now. Pressure is receding in governance. This suggests the risk profile is currently stabilizing. Risk levels are improving.

42.9th %ile (Sector)Accel: +0 Qtrs
Updated2026-06-02
Market View
₹604.95▼0.26%
PeriodQ4 FY26

Score Waterfall
Absolute contribution points of each forensic pillar to the final risk score. Derived from: Sector Baseline + Active Penalties - Mitigation Buffers.

Stability Adjustment
+20.0 pts
Final Composite Risk20 / 100

Investment Risk Thesis

Historical Trend

Current risk score has risen from 4 → 20 over 13 quarters.

Expected Direction
🟢 Improving
Primary Deterioration Drivers
  • Margin Compression
  • Inventory Stress
  • Relative Growth Weakness
What to Watch Next Quarter
  • Operating profit margins
  • Debt growth
  • Operating cash flow

Active Risk Objects (9)

CriticalHigh
Margin Compression
📊 Earnings QualityAnnualActive for 1 Years
More Detail
Impact Weight15/15
MomentumDecaying
Last SignalQ4 FY2025
Operating margin declined by 4.6 bps YoY for two consecutive quarters.

"Operating efficiency is stabilizing. The rate of margin deterioration has slowed."

Operating Leverage Stress
📊 Earnings QualityAnnualActive for 2 Years
More Detail
Impact Weight10/15
MomentumAccelerating
Last SignalQ1 FY2026
Expenses are consistently growing faster than revenues, creating operational pressure.

"The balance sheet is heavily over-leveraged. Interest payments are consuming most of the profit."

Low Interest Coverage
💧 Liquidity & CoverageQuarterlyActive for 5 Qtrs
More Detail
Impact Weight8/15
MomentumDecaying
Last SignalQ2 FY2026
SFL: Low Interest Coverage Ratio of 1.44x in FY2026 Q2 (Threshold: 2.5x).

"The ability to cover interest is strengthening as earnings improve or debt is retired."

Profit Collapse
📊 Earnings QualityQuarterlyActive for 3 Qtrs
More Detail
Impact Weight8/15
MomentumDecaying
Last SignalQ1 FY2026
SFL: Net Profit collapsed by 84.6% from FY2025 Q1 to FY2026 Q1.

"Earnings quality is stabilizing. The reliance on non-operational items is receding."

Cash Conversion Deficit
📊 Earnings QualityAnnualActive for 1 Years
More Detail
Impact Weight6/15
MomentumDecaying
Last SignalFY2024
SFL: OCF below Net Profit in 2/3 recent years.

"Cash conversion has normalized in the latest period. Operational cash flow is back in sync."

Relative Growth Weakness
📊 Earnings QualityAnnualActive for 3 Years
More Detail
Impact Weight12/15
MomentumPersistent
Last SignalQ3 FY2026
Revenue growth consistently lags behind sector median (12.8%).

"Early signs of earnings quality decay. Profitability is being driven by non-core items."

Inventory Stress
📊 Earnings QualityAnnualActive for 1 Years
More Detail
Impact Weight15/15
MomentumDecaying
Last SignalQ2 FY2025
Inventory growth (50.2%) significantly outpaced revenue growth (32.5%).

"Inventory overhang is clearing. Stock levels are normalizing as sales momentum returns."

Working Capital Expansion
💧 Liquidity & CoverageAnnualActive for 1 Years
More Detail
Impact Weight10/15
MomentumDecaying
Last SignalQ2 FY2024
Working capital expansion detected: Receivable days increased by 26.7%.

"Working capital pressure is receding. Cash previously locked in operations is being released."

Capex Efficiency Stress
📊 Earnings QualityAnnualActive for 1 Years
More Detail
Impact Weight8/15
MomentumDecaying
Last SignalQ2 FY2024
Aggressive Capex (22.5%) amidst slow revenue growth (-14.4%).

"Earnings quality is stabilizing. The reliance on non-operational items is receding."

Risk Trajectory
Historical 12-quarter risk trend (Q-11 to Q0) followed by a 2-quarter predictive funnel (Q+1, Q+2).
Loading Chart
Resilience Matrix
Diagnostic benchmarking comparing structural sensitivity and risk buffers against sector medians.
MetricValuevs SectorSignal
Volatility (σ)5.3312.35✅ RESILIENT
Sensitivity (ε_s)11.00✅ RESILIENT
Escalation Prob.5%5%✅ NEUTRAL
Safety Buffer+46.0+42.0✅ RESILIENT
Forensic Benchmark Context: Furniture Home Furnishing (n=8 peers)

Correlation Analysis
Visualizing the relationship between stock price movement and structural risk objects.

Loading Chart
Share Price
Risk Score (0-100)
Market Performance
₹604.95(-0.26%)
1M Divergence+16.57%
1 Week-3.47%
1 Month+18.84%
6 Months-0.06%
1 Year-3.33%
2 Year-31.77%
3 Year-40.47%
Sector Average (1M)+2.27%
Sentinel Forensic Assessment
ALGORITHMIC RISK PROFILE • NON-ADVISORY

The risk profile is Early Signals and currently improving. Recent structural triggers in governance suggest a building pressure on the underlying framework. Material forensic traces are visible in structural transparency and audit trails, indicating a progressive erosion of structural stability. Initial structural recovery is visible; monitor for a sustained return to resilience.

SFL • MARKET STRUCTURE

Stage 1 — Accumulation

The company is in a foundational phase. Risk metrics are stabilizing as the company builds a base for potential future fundamental improvement.

Stage Transition Prob.12%
Trend QualityEarly Base
Phase Progression
Phase Progression Score40%
Readiness LabelLow (Early Base Consolidation)
Probability of Advancing12%
CoinTree Momentum
Composite Z-Score+0.1488σ
Improving momentum strength
Universe Rank
A cross-sectional rank of this stock's composite momentum score compared to all other tracked equities in the universe. A rank of #1 of 1035 means it has the strongest overall price momentum in the market.
#745 of 2716
Top 27.43% in momentum strength
Timeframe Sparklines
1W-3.5%
1M+18.8%
6M-0.1%
Weinstein Indicators
150 DMA₹574.02
200 DMA₹603.48
150 DMA Slope-1.9237%Declining
Relative Strength+5.43%Leading
Relative Turnover (RTR)2.0556
ParticipationHealthy

PEER COMPARISON

Ranked comparison against sector peers

Risk profile is broadly in line with the Sector Mean (24).
SFLSheela Foam Limited
20 Risk
Sector %ile43th
Delta-5
Active Flags9
Accel+0
Governance

Watch

BIRLANUBirlaNu Limited
28 Risk
Sector %ile57th
Delta-5
Active Flags29
Accel+0
Balance Sheet Stress

Watch

AHLADAAhlada Engineers Limited
35 Risk
Sector %ile71th
Delta+5
Active Flags26
Accel+1
Competitive Position

Watch

RESPONINDRESPONIND
35 Risk
Sector %ile71th
Delta0
Active Flags20
Accel+0
Earnings Quality

Watch

* Peer comparison is based on risk signals, not valuation or returns.

Risk Profiles

Solvency
10100th %ile
VS Sector Median (8.5)
Governance
10100th %ile
VS Sector Median (8.5)
Earnings Quality
10100th %ile
VS Sector Median (8.5)
Balance Sheet Stress
10100th %ile
VS Sector Median (8.5)
Competitive Position
10100th %ile
VS Sector Median (8.5)
Growth Sustainability
10100th %ile
VS Sector Median (8.5)

Deterioration Timeline

2026

Relative Growth Weakness

2026

Relative Growth Weakness

2026

Operating Leverage Stress

2026

Relative Growth Weakness

2025

Margin Compression

2025

Operating Leverage Stress

2025

Inventory Stress

2024

Working Capital Expansion

2024

Capex Efficiency Stress

2024

Cash Conversion Deficit

Key Financials (INR Cr)

PeriodRevenueNet ProfitOCFDebt
FY20263,875161409908
FY20253,570972521,462
FY20243,099184571,281
FY20232,960203212468