Ahead of opening of its initial public offering (IPO) on July 10, 2025, Smartworks Coworking Spaces Ltd., a prominent name in India’s rapidly expanding flexible workspace sector, witnessed a historic milestone. Priced in the band of ₹1125-1128/share for a targeting a total issue size of ~₹583crore and a valuation range of ₹4,400–4,650crore, the IPO has garnered huge attention due to its rock solid financials and eye-popping grey-market cues.
📌 Price Band & IPO Structure
Price range: ₹387 to ₹407 per equity share
Issue size: ~₹582–583crore, comprised of:
Fresh issue of₹445crore(1.09crore shares)
Offer-for-sale (OFS) worth ₹137–138crore
Lot size: At least 36 shares (₹13,932–14,652)
Investor quotas:
Qualified Institutional Buyers (QIBs): 50%
Non-Institutional Investors (NIIs): 15%
Retail Investors: 35%
Key dates:
Subscription window: July 10–14
Anchor allocation: July 9
Allocation- July15, Refunds – July16, and Listing – on July17.
This is an institutionally backed / retail participation arrangement, providing easy onramp-type investment.
📊 Grey Market Premium (GMP): Strong Indications Recommended
Unofficial grey market rates (as of 9 July 2025) are trading ₹28 above upper band indicating listing price at around ₹435 i.e. higher than the IPO cap by 6.9%. This is being watched by retail investment apps that follow GMP, generally part of a hot IPO — workspaces are hot and folks are excited early.
While GMP isn’t official, it frequently matches up with performance on the actual listing day.
🧠 Financials & Growth Metrics
Smartworks has shown a strong financial growth even as it is investing big in expanding:
Revenue: Grew from ₹711 crore in FY23 to ₹1,374 crore by FY25— CAGR of ~39 %
Adjusted EBITDA:$36 crore to ₹172 crore— CAGR of 117%
FY25 sales: ₹1,409.7crore (up 27% YoY from FY24)
Net loss: ₹63crore in FY25 (higher, but… strong EBITDA margins of ~62%)
This financial picture demonstrates healthy top-line growth and improving bottom-line power while still in red on a net basis – character of fast scaling asset heavy platforms.
📐 Business Model & Expansion Wahroom Academy Private Limited is the product of a combination of successfully executed floors & an efficient operating model.
🏙️ Scale & Network
As of June 2025: 10 million sq ft of coworking space spread across ~41 operating centres in 14–15 cities (including Tier-I and Tier-II metros)
Two years have more than doubled the seat capacity from 86,000 to 182,000
Will cater to large-sized campus (180k sq ft is the average size) built to suit, to mammoth 700k sq ft campus in Bengaluru’s Sarjapur Business Today
🏢 Clientele
Serves 800 corporate clients shifted RRP (like blue-chips Google, Adidas, Philips) and jumping from FY22’s600 clients
Republic World
35+10M/$15M Selling in enterprise mid-market, needs to compete at higher end of market -empower tenured AE to sell for more revenue (want to get 80% of revenue through companies with 300 seats); sell to BDM in mid-size and enterprise Customers are 0-3 to churn back with new model Targets – Mid/Enterprise Does not sell Government Customers First demo with VP in room for FTF Opps – Close Large~50k ACV+ line of business 300 seat enterprise segment including multiple countries Small teams go up to small 60-100 organisations Prospect stops responding >1 year (cause?
🌱 Margin-Accretive Services
Enhanced amenities such as Fit-Out-as-a-Service (FaaS), cafeterias, gyms, and daycare to drive higher customer business, and power more revenue per seat
💰 Use of IPO Proceeds
Smartworks would primarily utilise the fresh equity proceeds (~₹445 * crores) towards the following \/ usages:
Repayment of debt: ₹114crore for reduction of high-cost liabilities reducing debt level from ₹299crore to ₹175crore
Capex and deposits: ₹225–226cr for New centre fit-outs and deposits
General corporate purposes: The balance of these funds will be used to help finance continuing operations and future growth programs.
With the reduction of debt coupled with the continued expansion, Smartworks becomes even more robust on the balance sheet as well as the growth runway.
📈 Valuation & Market Outlook
On the top end of the IPO price, Smartworks would be valued at post-money ₹4,645crore, in line with listed peer Awfis (~₹4,800crore). The discount compared to par may help to attract ure growth oriented investor.
The grey market is pricing the issue with a ~7% listing premium, which suggests there is significant early demand. Nevertheless, the wider market – in particularly the flexible workspace sector – remains robust with growing occupier demand from enterprise and tech firms.
✅ Investment Pros & ⚠️ Cons
Pros:
Rapidly scaling, accretive (SaaS-lite), asset-light coworking play already growing 10%+ top line annually
Robust margin performance and operational efficiency gains
Balance sheet clean-up with the IPO cash proceeds
Strong sell-side demand and attractive prices
Cons:
The net losses persistThe company is still in the midst of investment cycles
Largely contested space with the likes of Awfis, WeWork India, IndiQube
Economic cyclical; occupancy levels may vary
Execution risk with real estate constraints and lease commitments
🧭 IF Listing Outlook Produced by MD Lab Author: Kritzman Lai &Peita Lu Listing Outlook & Investor Considerations
As long as a GMP exists and market sentiment remains constant, then a ~7–10% listing premium seems reasonable. Long-term investors should weigh:
Pat profits : Will EBITDA margin gains convert into this?
Space use patterns and financial conditions
Competitive position relative to peers
The macroeconomic effect on corporate leasing budgets
Yet for those looking for a growth-oriented, listed bet on India’s coworking boom, Smartworks ticks most of the boxes — scale, client stickiness and high level of institutional interest.
🧾 Final Observations
The Smartworks IPO is an exciting opportunity in the evolving workspace space in India. Backed by earnings momentum, strong anchors and a compelling grey market buzz, it’s an echo of Awfis’ success story. Smart investors should:
Keep an eye on trends in GMP, subscription as IPO window (July 10–14) ///
Review peer performances post-Awfis listing
Test positional fit — either for listing-day gain or longer-term growth
With a potential July 17 listing, Smartworks may set the tone for flexible office space plays in a post-COVID economy.
