**Sheela Foam Plans Further Investment in Furlenco’s Parent Company**
Sheela Foam Ltd is poised to inject additional capital into House of Kieraya Ltd (HoK), the parent company of furniture rental startup Furlenco, as it aims to secure between $10 million and $15 million in funding. According to sources familiar with the situation, the company is looking to attract both new and existing investors, with deal structures still under negotiation.
Since its listing in 2016, Sheela Foam has invested approximately ₹400 crore to acquire a 45% stake in HoK, making it the largest shareholder. With a 50.10% equity voting rights, HoK holds strategic significance for Sheela Foam, potentially serving as a growth avenue for the mattress manufacturer, as noted by Crisil in April. The company is targeting to raise over ₹100 crore ($12.5 million) to support its expansion plans and aims to reach a revenue milestone of ₹500-600 crore within the next three years.
Sheela Foam has not yet responded to requests for comment, and HoK has also declined to provide a statement. In 2023, Sheela Foam acquired a 35% stake in HoK for around ₹300 crore, entering the rapidly growing branded furniture market, which valued the company at approximately ₹857 crore. The following year, Sheela Foam increased its stake by an additional 10.5% with a ₹107 crore investment.
The mattress maker, which owns brands like Kurlon, Sleepwell, Joyce, and Interplasp, has been actively involved in HoK’s operations, with three out of five board members from Sheela Foam. Crisil indicated that HoK could receive immediate financial support if needed.
In the past year, Sheela Foam’s shares have seen a decline of about 27%. Earlier this year, HoK secured $7 million in a debt funding round from Northern Arc and CredAvenue. The subscription-based furniture rental startup had previously raised $140 million in a funding round led by Zinnia Global in 2021, combining debt and equity. In May 2022, it also raised additional debt funding from revenue-based financing platform Klub.
Founded in 2012 by Ajith Mohan Karimpana, Furlenco operates in the over $5 billion rental furniture and appliances market, with a presence in major cities including Bengaluru, the National Capital Region, Hyderabad, Chennai, Mumbai, and Pune. The company offers a range of products on a monthly, half-yearly, and yearly rental basis.
HoK competes with companies like Cityfurnish and Rentomojo, boasting a subscriber base of over 100,000, with a monthly net addition of 4,000-5,000 customers. The company distinguishes itself through in-house design and substantial manufacturing capabilities, which account for 40-50% of its production. In FY24, HoK reported revenues of ₹140 crore, a decrease from ₹156 crore the previous year.
**FAQ**
**What is the significance of Sheela Foam’s investment in HoK?**
Sheela Foam’s investment in HoK is significant as it positions the company to tap into the growing furniture rental market, potentially enhancing its revenue streams and market presence.
