Indo Count Industries Limited (NSE: ICIL) Q1 2026 Earnings Call dated Aug. 13, 2025
Corporate Participants:
Unidentified Speaker
Mohit Jain — Executive Vice Chairman
Manish Bhatia — Chief Financial Officer
Analysts:
Unidentified Participant
Prerna Jhunjhunwala — Analyst
Ashwini Agarwal — Analyst
Surya Narayan Nayak — Analyst
Jayesh Shah — Analyst
Raman Venkata Kerti — Analyst
Vikram Suryavanshi — Analyst
Shubhankar Ojha — Analyst
Abhishek Shankar — Analyst
Kaustubh Pawaskar — Analyst
Presentation:
operator
Ladies and Gentlemen, good day and welcome to Indoor Count Industries Limited Q1FY26 earnings conference call. This conference call may contain forward looking statements about the company which are based on beliefs, opinions and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involves risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need a recent during this conference call, please signal an operator by pressing Star then 0 on your Touchstone 4.
Please note that this conference is being recorded. I now hand the conference over to Mr. Mohit Jain, executive Vice Chairman. Thank you and over to you sir.
Mohit Jain — Executive Vice Chairman
Good morning and a very warm welcome to all of you joining us for the Indo Count Industry Earnings call. I’m also joined by our group CFO Mr. Murlidharan Manish Bhatia, CFO and Strategic Growth Advisors, our Investor Relation Advisor. We hope you had the chance to review the financial results and investor presentation available on the Stock Exchange and on our company website. To begin with, I’m delighted to share a moment of great pride and excitement for all of us at indocamp. The relaunch of the iconic Wamsutta brand in USA as a direct to consumer offering which is exclusively now available at wamsutta.com a 180-year-old heritage brand, Wamsutta has long been synonymous with premium quality bedding and bath products.
Loved and endorsed by millions, it became a household name and a category leader over generations. Its relaunch marks a significant milestone in Indo Count strategy. The refreshed Wamsutta brand retains its timeless promise of comfort and quality while embracing a premium positioning tailored for today’s discerning customer. By reintroducing it through the direct to consumer channel, we are proud to connect with a new generation even as we honor its enduring legacy. We are confident that this strong comeback will pave the way for even greater strides for the brand. Warmsutter will go beyond bedding and will also cater to other soft home products such as towels, pillows, blankets, rugs, window treatments, etc.
As we step into FY26, we have revisited our business categories and product offerings aimed at providing greater clarity to the investor community on how Indo Count has evolved and continues to progress. To simplify our approach and enhance transparency, we have reclassified our portfolio into two key verticals I.e. core business and new businesses. This structured view enables to clearly understand the progress of the strategic initiatives we are undertaking within each of the businesses and the direction in which we are moving. Core business is our bed linen segment and this will include bed sheet business I.e. flat sheets, fitted sheets, pillowcases, fashion bedding, institutional bedding and the Indian domestic business.
This segment will also include its branded business across all the above categories comprising both private label and Indo Count’s owned or licensed brand. However, excluding USA brands, new businesses will include both our utility bedding business and our USA brand business. Utility Bedding business covers products such as pillows, mattress pads, down old comforters and quilts, pillow and mattress protectors. Owned and licensed brands such as Beautyrest, SleepRx Pillows falls under utility bedding business USA Brand Business, a pure play branded business encompassing any product category such as sheets, pillows, quilts, towels, window treatment, etc. Sold under these brands would be Wamsuta, Fieldcrest, Waverly and Gaia.
This new representation will help you assess the direction of our efforts across the business. Just to reiterate on the branded business, all other brands whether owned or licensed, excluding USA brands will be classified under the bed linen segment. Utility bedding brands have been highlighted separately while our domestic brands, Boutique Living and Layers will continue to be part of the bed linen segment. Total branded business across all three categories contributed to approximately 20% of overall revenue in Q1 FY26, again 16% in FY25. On the financial performance of both the business verticals, our core business delivered a 16% CAGR over the last two years, that is FY23 to FY25 while our new business expanded nearly four folds during the same period.
Consequently, the revenue mix in the new business shifted from 2% in FY23 to 7% in FY25 and is currently stands at 13% in Q1 FY26. Moving on to the current business update, FY26 began with significant uncertainty. The overall demand sentiment showed signs of softness due to the US Tariff situation leading to demand cutbacks that impacted volumes and revenues during the beginning of the quarter. The fluid trade environment has prompted customers to prioritize inventory control and portfolio realignment weighing on overall demand. Turning to our new business, the utility bedding and USA brand segment recorded higher revenue and contributions this quarter.
Revenue from these businesses rose to rupees 130 crores in Q1FY26 compared to rupees 125 crore in Q4.25. These segments remain key future growth drivers. The utility bedding segment with its manufacturing base in the United States, benefits from a unique market position and strong customer relationships. Moreover, brand related demand in these categories is driven more by performance than price sensitivity. Currently in the utility bank business we are operating at approximately 50% capacity utilization. The past few days have been challenging with the tariff situation remaining highly volatile. There has been continuous changes in the tariff situation since April.
Initial tariff of 10% was increased to 25% which has now been increased to 50% from end of August. Yet considerable uncertainty persists. We are in continuous dialogue with our customers as they revisit their sourcing plans. We hope the situation to stabilize soon. Our core bed linen segment continues to face headwinds, particularly from lower volume offtake and unfavorable product mix and pricing pressures stemming from the prevailing tariff environment. Our new business, while the pace remains gradual, continues to show positive trajectory and customer acceptance. While the near term volatility may impact performance for a quarter or two, our commitment to achieving our 2x growth guidance remains unwavering.
In the backdrop of such challenging times, we have done better with a year on year growth of 2% in revenue and approximately 372 basis points. Expansion on Margin on Quarter on quarter basis the revenue growth was contributed by our new businesses which continue to gain traction. The margin expansion on quarter on quarter basis was on account of stringent cost controls and other efficiency measures. However, margins remained below last year’s levels due to the unfavorable product mix and the incubation costs related to the new businesses. Costs that we have indicated will persist until the end of this year.
In the near term, both margins and sale volumes are expected to remain under pressure until the US tariff environment stabilizes. Coming to other markets over 50 countries and have been expanding our footprint through focused efforts in recent years. With government signing new FTAs we expect our market share and contribution from row markets to grow in the near future. Several economies are emerging as promising destinations for Indian products and in many FTA markets we have already been seeding demand for some time, placing us in a strong position to capture upcoming opportunities. In certain geographies we are already well established with customers enabling faster scale up.
In summary, we are all well prepared to navigate the evolving global landscape and capitalize on emerging opportunities. With our growth strategy extending beyond product diversification to include geographic expansion. Notably, our non US business now contributes approximately 30% of the core business, underscoring our sustained progress in broadening our market base. A significant development in this direction is India’s recent signed FTA with the UK aimed at accelerating economic collaboration between the two nations. The agreement is expected to boost trade volumes, facilitate greater market access and strengthen investments for the textile industry. It eliminates duties of 10 to 12% on Indian products, significantly enhancing our competitiveness in the UK market.
This places India on the equal footing with countries such as Bangladesh and Pakistan which have long enjoyed duty free access. On the EU front, we are hearing encouraging developments and hope finalization of FTA between both sides gets concluded by end of this calendar year. We are hopeful on this FTA which will now open new avenues for growth, creating significant opportunities for the Indian textile industry Coming to India’s Home Textile Sector A Growth Story India’s home textile market is poised for robust growth fueled by rising domestic demand for bedding, bath and other home products. Factors such as rapid urbanization and higher disposable incomes are expected to further boost consumption while the growth influencing e commerce platforms will expand the industry’s reach.
In line with this potential, we recently organized our largest ever retailer and distributors trade meet for our domestic brands Boutique Living and Layers to unveil the autumn winter 2025 collection under the theme Feel the Future. This was our most extensive showcase to date, presenting an innovative and vibrant product range across our domestic brands. Boutique Living continues to gain strong traction in the mid to premium market. We have also made significant progress in category expansion, broadening our top of bed, bath and gifting portfolios to tap into the emotional role of home textiles in weddings, celebrations and everyday life.
In terms of market reach, both brands have expanded their presence to over 2000 MBO span India. Their presence in large format stores is also rising, further strengthening our retail distribution network. It is heartening to note that feedback from the event was highly encouraging, reaffirming our confidence in the domestic market’s potential. While domestic business currently contributes to approximately 2.25% of total revenue, we remain optimistic about strong growth in this segment as we continue to deepen our nationwide presence. Moving forward, I’d like to take a moment to highlight a new initiative undertaken by the company Indocound foundation in collaboration with the Maharashtra Government and Dr.
PD KY College of Agriculture, Nagpur Established in 2022 a center of excellence to promote sustainable high yield cotton cultivation. The outcome of this partnership has now led to the implementation of the High Density Planting System, a technique designed to enhance cotton productivity. This initiative has received high level recognition including praise from Agriculture Minister Sri Shivra Chauhan who lauded HDPMS as a game changing model for the Indian cotton farming. By 2025 its impact is already evident with over 12,000 hectares in a Kolar district. Successfully adopting the HDPMS model, HDPS has proved to be a leap forward in sustainable cotton innovation, delivering remarkable improvements in both plant density and yield.
Compared to the conventional method of 11,000 plants per acre, HDPS enables 29,500 plants per acre, nearly 3x the planting density. This increase translates directly into higher productivity, with yields rising from 450kg per hectare under traditional methods to an impressive 1250kg per hectare using this method. A standout success story features a pioneering farmer who achieved 29,400 plants per acre, validating the system’s potential and inspiring widespread adoption. This initiative not only boosts cotton output but also sets a new benchmark for sustainable agricultural practices in our country. To sum up, the current US Tariff situation may have a temporary impact on demand.
Having established a robust presence in the US market, our focus is now on moving higher up the value chain. This includes a commitment to premiumization, expanding our manufacturing footprint and strengthening our team with experienced and dynamic talent. By leveraging these strategic initiatives, we aim to multiply revenue, enhance profitability and write the next chapter of our success. This is from my side Now I request Mr. Manish Bhaja, our CFO, to share financial highlights of the company.
Manish Bhatia — Chief Financial Officer
Good morning everyone. Volume Sales volume for Q1FY26 stood at 23.6 million meters versus 25.3 million meters in Q1FY25, down by approximately 7% y1y on quarterly basis volume regrew by around 8%. Total income Total income for Q1FY26 stood at Rupees 967 compared to R950 crores in Q1FY25 reflecting a year on year growth of 2% on a sequential basis. As this was the first full quarter impacted by tariffs, revenue declined by 6%. Coming to EBITA, EBITDA for Q1FY26 stood at rupees 119 crore compared to Rs. 154 crore in Q1FY25 down 23% year on year, EBITDA margin was 12.26% versus 16.17% in the previous year.
Around 200bps of the margin. Contraction can be attributed towards incubation costs of new businesses which are expected to continue until the end of this year. This we have mentioned in the earlier calls also. The remaining decline was primarily due to an adverse product mix and lower volume. On a sequential basis, EBITDA increased by 35% with margin expansion of 372 basis points to 12.26% from 8.55%. This was driven by internal cost efficiency measures undertaken. FAT for Q1FY26 stood at rupees 38 crore compared to rupees 78 crore in Q1FY25. The decline was driven by lower operating performance along with higher depreciation from new facilities and increased finance costs arising from investments in newer businesses.
As volumes in the core business scale up and the new businesses show more traction, we expect stronger EBITDA to PAT conversion over the next two years on QoQ basis. Pat improved significantly as overall operating profitability improved coupled with lower finance cost. EPS for Q1 FY26 is Rupees 1.91 debt. There has been approximately Rupees 60 crores of debt reduction in this quarter. With this, we open the floor for Q and A.
Questions and Answers:
operator
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press STAR and one on the Touchstone phone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Prerana Junjunwala from Elara Securities. Please go ahead. Your line has been unmuted. Please proceed with your question.
Prerna Jhunjhunwala
Hello. Am I audible now?
operator
Yes,
Prerna Jhunjhunwala
thank you. Thank you for the opportunity. Just wanted to understand how are the US retailers behaving in terms of order placements and negotiations with respect to 25% tariff or 50% tariffs?
Mohit Jain
Morning, Prerna. So as far as right now, as we speak, it’s business as usual. You know, I think everybody is waiting and watching, but there’s no change. Whatever orders we have continue, we continue to ship and against projections, we continue to get purchase orders.
Prerna Jhunjhunwala
Okay, so there is no major change in the market share of the country or market share of Indocom that we should expect if these rates continue?
Mohit Jain
Not as of this morning.
Prerna Jhunjhunwala
Okay, understood. And
Mohit Jain
it’s all very early days, you know, so we got to keep that in mind.
Prerna Jhunjhunwala
Yeah, I understand this is as, as of today because things keep changing every day in current scenario. So I understand that. Also I wanted to understand like tariff, the impact of tariff, how much have we shared during the quarter? Is there any impact of increased tariff of around 10% like imposition of tariffs in the, in the quarter?
Mohit Jain
Sure. So we have taken calls on a case to case basis due to business sensitivity. We would not like to get into further Details
Prerna Jhunjhunwala
on an average.
Mohit Jain
No, I mean you can see that in our results. Yeah.
Prerna Jhunjhunwala
Okay. So the impact that would be there would be in gross margins largely.
Mohit Jain
Across the board. You know, it could come, you know, if it’s FOB shipment, it would be in gross margin. If it’s not, it could come, you know, below also.
Prerna Jhunjhunwala
Okay, understood. Sir, you’ve taken cost control measures visible in other expenses. Could you please highlight few of them to understand whether these cost control measures are sustainable or only for. For few, few quarters.
Manish Bhatia
So we were also benefited by lower raw material basket. Plus there were some other savings like product related, production related, marketing expenditure related. So these are like operating efficiency also because these are certain bit of variable expenditures depending on the volume.
Prerna Jhunjhunwala
Okay, understood, understood. So last question on non US exposure. You mentioned that your non US exposure is increasing. Where do you see this non US exposure reaching in the next three to five years? Will that be a growth driver? And which geographies are you targeting for? The same.
Mohit Jain
As we have said in the past, the geographies right now that are we shipped to over 50 countries. Countries like Australia, Japan, Middle East, UK, EU is opening up as we speak. So these are all countries that we have a presence in. And the presence is growing year on year for us over the years. I mean we expect our non core business now contributes to let’s say 30% of our overall product mix of our core business. You know, with the government signing new FTAs, we expect our share and contribution from these markets to grow in the near future.
And we’ve ceded the demand for some time now in several of these geographies. And we are well established. So I think it will only scale up from here.
Prerna Jhunjhunwala
Okay, understood sir, last question. What will be our U.S. exposure in FY25
Mohit Jain
70? I mean the breakup is roughly 70, 30. 70% is usually.
Prerna Jhunjhunwala
Okay, sure. Thank you so much sir. And all the best.
Mohit Jain
Thank you.
operator
Thank you. The next question comes from the line of Ashwini Agarwal from Demeter Advisors llp. Please go ahead.
Ashwini Agarwal
Good morning and thank you for the opportunity. So I was more interested in the US brand business. So you mentioned that you want to sell towels, window trims and a lot of other products that you don’t currently sell manufacture. From what I understand, is there a plan to get into all these product categories or these will be all be outsourced?
Mohit Jain
You see, let’s look at it from a different perspective, Ashwini. You know, today these are brands, you know, from a consumer standpoint, when the consumer is buying the brand they want to get a complete holistic soft home experience, you know, so our design teams, our product development teams, you know, design the whole range of the product across all soft home categories, right? From a pillow to a mattress pad to a fashion bedding, to a bed sheet to a towel to a window treatment. And then we present the collection to the customer. So we already started selling since last year.
All these product categories is already, we already selling under our brands. They already placed with retailers. And so we’re going to grow into these categories. We have no plans to produce these as we speak, you know, so we have vendor partners who we’ve tied up with and who bring their best to us. But these are all products that are designed by our design teams and then brought to customers and then in turn sourced globally.
Ashwini Agarwal
Okay. And the vamsuta range of bed linen you would manufacture in house or would that be sourced from vendors
Mohit Jain
at this point of time? That is all manufactured at, in our own facility.
Ashwini Agarwal
And coming to the margin profile of the US Brands business over a longer period of time, I mean, as you grow this portfolio, what do you think is the margin profile that’s achievable in this piece of the business?
Mohit Jain
Yeah, I mean, you know, as a company we are striving to be between 16 to 18%. And this particular segment should give us a higher margin than our core business. You know, but it’s yet early days for us. You know, we are dealing with a lot of uncertainty, a lot of things coming our way. So I think we just need to digest what we have, build the business, be relevant to the customer, and I think everything else will fall in place.
Ashwini Agarwal
And my last question is the potential for the Indian brands business, which is say two and a quarter percent of your revenue as of now. I mean, it’s, to my mind, it has a huge potential, but obviously there must be some reasons why it hasn’t grown. How do you see this business? And I note that you held your first ever trade convention, the largest one, a couple of days ago. How do you see this business evolving?
Mohit Jain
India has humongous potential, but one has to take one step at a time. You know, here we are selling, we’re not trying to sell any of our export surplus. These are products that are made for the domestic market, designed for the domestic market. We have huge collections. You know, we need to have a, we have a reach now, you know, so it’s one step at a time. We have a team of over 100 people in the system for this department. So I think it will, it’s only. It’s only going to be upwards. And it wasn’t our first show.
It was the largest that we had. We continue having these but this was the largest attended that we had and we had it at the Grand Hyatt in Mumbai, you know. So we are notching it up slowly, you know, slowly and steadily. You know. We are not. We’re going to take it at one step at a time so that it’s sustainable, you know and profitable.
Ashwini Agarwal
And this is not. There’s no B2C D2C segment here. This is all via MBOs.
Mohit Jain
It’s MBOs. It is like stores, you can say large format stores, you know. So mostly B2B. We have products on our website, you know which is BoutiqueLivingIndia.com and layers which we launched in fact in this quarter. But predominantly the distribution is B2B you can say. And then of course we are available on the marketplaces also online.
Ashwini Agarwal
And your capex peaks this year from here on it should kind of roll down over the next two years. Would that be a correct assessment?
Mohit Jain
Yeah, more or less. I mean whatever we’ve, you know showcased so far is there’s nothing else on the table but you know we keep getting opportunities which will get evaluated as and when they come. But as we speak it is what we have right now, you know. And then Normally we have 50 to 75 crore of regular capex every year in our facilities which is historically the case and even this year I think we’ve shown 65 crores for this year.
Ashwini Agarwal
Yes, that’s regular maintenance capex. Yes, I get that. Yeah. Okay, thank you. Thank you so much. I’ll come back in the queue.
operator
Thank you. The next question comes from the line of Surya Narayana from Sunidi securities and Finance limited. Please go ahead.
Surya Narayan Nayak
Yeah, thank you sir for giving opportunity and a great set of numbers in challenging environment. So. So just my question is that considering the current difficult situation on the tariff front. So do we think that your understanding of the US customers the premium pay rate of the customers. So do you think we will be able to sustain for FY26 and at least now we may see some kind of volume degrowth. I understand. But still we’ll be able to manage to get at least. No, maybe with maybe 5 to 6% kind of degrowth with the realization intact.
Mohit Jain
I wish I was a magician, you know, or a Jotsi. I don’t know what you. But right now, you know we are just taking it, you know each day as it comes and. And we are, we are not pessimistic. We are yet optimistic, you know, so our objective, like I said in the last call, also is to maintain our market share and grow it. And that’s what we are striving to do.
Surya Narayan Nayak
Okay, and what is the, what is the plan for FY26 so far as the US operations are concerned, like future Text Modern and brown or the brands and apart from the Greenfield, so what are, what are the kind of revenues you are expecting in the US operations alone, which is not affected, which will not be affected by the tariffs.
Mohit Jain
So I think you’re referring to our manufacturing business which now by September end we’ll have the third plant also in Kernersville, North Carolina operational. And that’s our flagship and will be our largest location. So A, I’m happy to share that. You know, we are already at a 50% utilization. We just got into this business less than 12 months ago. And over a period of three years starting this financial year, we are quite optimistic of achieving 175 million in revenue. You know, so in this category of business of utility bedding which is being manufactured in the United States,
Surya Narayan Nayak
so last. Year we did in total maybe 175crores if I’m right. So, so this year you are saying, you know, around what is the kind of revenue it is of 1500 crores.
Mohit Jain
No, no, what I’m saying that over a three year period we’ll do 175 million in revenue in this category. It’s very difficult to say how much will we do this year, how much would we do next year? You know, but it’s on a growth, it’s on a growth mode
Surya Narayan Nayak
because you. Know that, that, that, because the tariff will not be there for those kind of goods. So obviously the appetite would be intact and obviously so I mean the steady state basis, you could be drawing some, some kind of projections for at least FY26. So what kind of figures you are actually pointing out,
Mohit Jain
so I would not. Be able to comment on an exact number, but please keep in mind that these are goods that are manufactured in the US These are utility bedding products that we are manufacturing, which is predominantly different types of pillows and quilts. This is our manufacturing capability. This is a new product category per se for indoor count. Basically these are white goods. Of course their raw material does get imported. The advantage we have is that we are not bound to any one country. We can, I mean the team can source globally. So that’s the advantage that we have.
Of course, whenever you’re buying from one country and you need to move supply chain to another country. It takes time, you know, but other than that the raw material prices would go up which we’ll pass on to the customer and move forward here.
Surya Narayan Nayak
And considering your deep understanding of the US market customers profile. So do you think that now due to the tariff issues the, the US customers will settle to lower or economical kind of products rather than they will stick to the premium kind of products? I mean that is the usual case for the US market. So what is your understanding till date? I mean since February this year. So are you, are you seeing the US customers sticking to the kind of, you know, I mean appetite they are having towards the premium goods that is intact?
Mohit Jain
You know these are all very early days. You know there’s too many things up in the air as we speak. You know things have just started moving between March and now. By end of this year all of this should settle down. Having said that, of course we have seen a little bit of down trading happen in the product portfolio that people do not want to invest too much in luxury goods. So that because the tariff impact is higher. I think this is, it’s not about our product category A. It’s, I think the retailers are assessing as we speak, you know, what is the customer appetite, you know, to pay higher prices, what’s the elasticity? So I think all of this will get played out as we speak.
You know there’s no, nobody has including the retailer and I answer today that what’s the, what’s the right formula? So it’s all trial and error that they’re doing out there and they’re pricing, they’re trying prices out. People have increased retail prices. So it’s all being tested out, you know, as we speak. So it’s a dynamic situation.
Surya Narayan Nayak
Okay. Okay. And the budget for this year, 214 crores will be intact and we will definitely be maintaining that. Apart from the ment maintenance capsis of 65 crores. I mean the, the, the North Carolina and the JD that is, that is budgeted for this year that will be going through irrespective of the market situations.
Mohit Jain
Yeah, more. I mean as you can see and we’ve showed in our Q1 we’ve already spent 72 crores. Approximately 70 odd. You know, out of the 200 odd that we’ve said. It’s only the Bilard effluent treatment plant that hasn’t started yet. You know, so there could be some spillover into next year. But these are long term projects that. Will go through you know,
Surya Narayan Nayak
ZLD will. Be taken over or taken of this. Year or next year
Mohit Jain
should be taken. Up towards the end of this year. We’ll start at the end of the project.
Surya Narayan Nayak
Okay. Okay, thank you.
operator
Thank you. The next question comes from the line of Jayesh Shah from OHM Portfolio Equity Search. Please go ahead.
Jayesh Shah
Hi, thanks for the opportunity. My question is, as for the media articles, we believe that this is the time when the busy season orders are issued out in the US and which India may be losing out to the other competing countries. So how are these discussions and negotiations going on and is it that you are able to maintain those orders at a certain discount? And secondly, if you have to replace your US business, to what extent can you sell in discounts in Australia, Japan to make up for the loss of these orders?
Mohit Jain
We are not looking, Jaish, to replace the US with Australia by selling at a discount. That’s not a viable business situation because we’ll be spoiling those markets and forever. And that’s not a sustainable business model either. To your first question, we are mostly in the replenishment business. So what happens in our case? We get projections from our customers which is like a 12 month rolling projection and then we get purchase orders 45 days before shipment so that business continues as is. So it’s not really a season. You know, we are not in the fast fashion business where you’re working from one season to another season.
So these are back wall programs. It’s in the stores selling continuously.
Jayesh Shah
I see. So hypothetically, you know, if this 50% tariff continues beyond say August, is there any way that you would be able to sell in the US or that option is out because you know, it’s too huge a burden for any textile manufacture.
Mohit Jain
So the delta is, you know, between. You can, if the whole world average is between 20 to 30% right now.
Jayesh Shah
Right.
Mohit Jain
You know, so take a mean of 25. So at 25 and then you have 50. So 50 minus 25. We have a delta of 25. You know, there would be some business loss. To what extent? You know, it’s very difficult to predict.
Jayesh Shah
Okay, okay. That burden then would be shared across the entire supply chain and whatever.
Mohit Jain
Yes, yes. And then we’ll have.
Jayesh Shah
But then your US business would continue at whatever. So in a way to read from an investor point of view, maybe there is a hit on the EBITDA margin which you have to make up from cutting the other expenses probably on marketing or whatever. But overall sales revenue, there may not be a huge problem.
Mohit Jain
I think it all depends on how Each customer behaves, you know, it’s again very difficult to predict, you know, if India’s delta, in a product like textiles or other products that we’re exporting, white only textiles, is a 25% additional delta. You know, India will stand to lose at that standpoint. You know, I cannot imagine. And if as long as the two governments are talking and there’s a light at the end of the tunnel, then the, every, every large retailer, you know, who’s strategic in nature, will and we’ll all figure out ways to keep our businesses going.
But if, if this is engraved in stone and the relationships, you know, there’s no light at the end of the tunnel, then some businesses, you know, are going to move to other countries. You know, there’s nothing we can do about that.
Jayesh Shah
Right, right. Right. Thank you and best of luck.
operator
Yeah, thank you. The next question comes from the line of Raman KV from Secret Investment. Please go ahead.
Raman Venkata Kerti
Hello, sir, can you hear me?
operator
Yes, sir.
Raman Venkata Kerti
During the quarter I have noticed that your new business, which is primary, primarily manufacturing in USA has ramped up pretty quickly and steadily. I just want to understand, is this what the margin in the current quarter with respect to this business?
Mohit Jain
You know, as we mentioned that on an overall basis right now we yet have 150 to 200 basis point hit on our EBITDA margin, which will continue till the end of the year once this stabilizes, then these businesses, I mean in the short term should do the same level of margin as our parent business. So overall, as I said, our target is to be between 16 to 18% once things in the world normalize.
Raman Venkata Kerti
No, I just want to understand, is this EBITDA breakeven or it’s still your plan will be breakeven by the end of the year as the capacity ramps up?
Mohit Jain
Yes, even today it is EBITDA positive, you know, I mean, it depends how you look at it, you know, I mean not, I wouldn’t say it’s EBITDA positive, but we are recovering all our costs. I mean there are a lot of fixed costs right now in that business. That’s why it’s the 150, 52 basis points EBITDA hit at the end of the day, right? So we already put the team in place, we put the talent, we have the facilities, we have the infrastructure. So there’s a cost associated marketing, there’s cost associated to all of that, which we are pretty confident that by the end of the year that will all get absorbed, you know.
Raman Venkata Kerti
And so currently with respect to this business Itself, there are two plans, one on Arizona, one in Ohio. Can you give any capacity utilization?
Mohit Jain
Yes, as I said, it’s at 50%.
Raman Venkata Kerti
Okay. And so by the end of this year, how much, what percentage of revenue are you expecting from this new business?
Mohit Jain
As I mentioned, you know, we expecting 175 million from our utility bedding business. And we are pretty confident that over a three year period we’ll be able to achieve this.
Raman Venkata Kerti
No, no, I just want to understand. So with respect to, during this quarter the new business contribution to your overall revenue was 13%. So can we expect this same percentage for the remaining period as well?
Mohit Jain
Yeah, around these levels, Yes.
Raman Venkata Kerti
I mean and from FY25, can we expect the margins to be stabilized like around 15%?
Mohit Jain
Correct. That’s what has, I mean the hit on the margin which we, I mean like any business, you know, I mean we are seeding the business as we speak. So that will go away. You know, it should be able to stand up on its own.
Raman Venkata Kerti
Okay, thank you sir.
Mohit Jain
Thank you.
operator
Thank you. The next question comes from the line of Vikram Suryanshi from Philip Capital India. Please go ahead.
Vikram Suryavanshi
Yeah, good morning sir. Just wanted to take the power US Operation. You highlighted that there would be imported raw material slightly higher in duties now. So to compensate that, have we taken any price hike for our US Operation? The product which we are making there.
Mohit Jain
Absolute, absolutely. On a case to case basis that gets adjusted with the retailer. You know, they all understand if this is the new world normal then it’s, it’s normal for everybody. Right? All our competitors, everybody’s in the same boat. You know there could be a one month lag here or there or one or two months but otherwise it doesn’t matter. I mean it gets, it’s able to get passed on or the product gets re engineered by keeping the customer in conversation.
Vikram Suryavanshi
Got it. And second, I really want to acknowledge for your efforts about improving the cotton yield, that has been a really serious issue for India. But just on clarity on this 3x plantation increase, is it basically on irrigated land or it can be also implemented with the rain feed areas also.
Mohit Jain
We’ll have to check and get back to you. So you know, I don’t want to give you the wrong answer. You know, this is an initiative that our foundation took, you know, three years ago and you know, people saw it and you know, took it up and you know, they started getting the benefit, you know. But I don’t have the exact answer. We can get back to you on that.
Vikram Suryavanshi
Sure, sir. And thank you.
operator
Thank You. The next question comes from the line of Shubhangar Oja from SKS Capital. Please go ahead.
Shubhankar Ojha
Hello.
operator
Yes, sir.
Shubhankar Ojha
Yeah, thanks. Thanks for the opportunity. So my first question is the new acquisition, the plant in US Will it save the tariffs for us? Sorry to. Sorry if I’m asking repeating question because I’ve joined a bit later in the call.
Mohit Jain
Yeah, Shankar. No, I’m. I’ll explain. So these are three manufacturing locations which will manufacture pillows as well as quilts in the United States. One plant is in Ohio, one is in Arizona in a city called Phoenix. And the third one is in North Carolina in a town called Kernersville. The raw material for these are imported. The raw material is not produced in the United States. So most of it gets imported from different countries. It could be China, Pakistan, India. I mean we are, we can source from any country depending on the viability of that country and the product that they make and the specialty of the product and the technology that we offering to the customer.
Shubhankar Ojha
Okay. Okay. My next question is about the uk. How much benefit we will get from this tool.
Mohit Jain
On our product category. The duty is 12% as we speak now once the UK Parliament passes it, we’ve already started active conversations with customers, strategic conversations as what should be there. But 12% is what was India’s delta. Now when this goes away then of course India becomes very competitive as a country and some part of it would. The benefit should come to us as an organization. And some part the benefit will go to the customer and then the market share of India will improve within the uk.
Shubhankar Ojha
Okay, last question. Rest of the world.
Mohit Jain
Sure. So the of a core business, the US is around 70% in revenue. 30% is other countries. And out of the 30 out of the hundred, UK is around 10%. So 70 West, 10 UK and 20. Is rest of the world. If you want to put it that way.
Shubhankar Ojha
Yeah. Okay, thank you. I’ll get back to the chief.
operator
Thank you. The next question comes from the line of Abhishek Shankar from ICICI Direct. Please go ahead.
Abhishek Shankar
Yeah, thanks for the opportunity.
operator
Yes, sir.
Mohit Jain
Yes.
Abhishek Shankar
Yeah. So I see there’s a year on year decline in volumes and there’s a slide like there is a, you know, improvement. So considering that there was an unfavorable product mix actually come from.
Mohit Jain
Can you ask your question? Can you come. Your voice is cracking. Abhishek.
operator
Sir. Abhishek got disconnected. Maybe move to the next question. Ladies and gentlemen, if you wish to ask a question, you may press star and 1. The next question comes from the line of Coustopar from ICICI securities. Please go ahead.
Kaustubh Pawaskar
Yes sir, this is Kaustuber Abhishek. So what Abhishek was trying to ask is if we do a simple match dividing our revenues by volumes, we see that there is a realization growth on Y basis despite the fact that mix was unfavorable. So we just want to understand why, you know, the realization growth was there in this condo.
Manish Bhatia
So you can’t cannot compare Q1 of last year with Q1 of this year. Because Q1 of last year doesn’t include the acquisition business which we have in us. So that’s why you will see some anomaly in that.
Kaustubh Pawaskar
Yeah, okay. Okay. Okay.
Mohit Jain
Yeah, you need to minus the 130, more or less. I mean you need to minus the utility and the brand more or less. You get the rough number which is similar to Q4.
Kaustubh Pawaskar
Okay. And is it possible to give what were the volumes for the new business like 135 crores for the new business.
Mohit Jain
That business, it’s not derived by volumes. We don’t look at it in terms of meterage or anything of that sort.
Kaustubh Pawaskar
Okay, thanks for that.
operator
Thank you. As there are no further questions from the participants and I hand the conference over to Mr. Mohit Jain, executive Vice Chairman. Thank you. And over to you sir.
Mohit Jain
In conclusion, while macroeconomic uncertainty remains the bold transformation and vision of Indo Count’s 2.0 strategy of rewriting the future, the progress is visible. We have launched several forward looking initiatives to enhance our capabilities, explore new frontiers and create long term value. A new focus has been our entry into value added segments such as utility, bedding and branded businesses in USA areas that align with changing market needs and consumer preferences. This transformation reflects our ambition to become a more agile customer centric and future ready organization and a complete solution provider for home textiles. Furthermore, our strengthening presence in the domestic market presents a valuable opportunity to further grow our business.
Thank you for your ongoing support as we move forward on this exciting path of expansion. I hope we have been able to answer all your queries. In case you have more queries or require any clarification, please feel free to connect with us or sga, our investor relation advisor. Thank you for joining the call.
operator
Thank you on behalf of Indo Account Industries Ltd. That concludes this conference. Thank you for joining us and you may now disconnect Alliance. Thank you.