As of 12:14 pm today, NIIs had subscribed to the issue 1.36 times, applying for 30,21,372 shares against the 22,17,233 shares reserved for them. This was followed by retail investors, who subscribed to 86% of their allotted quota. Qualified institutional buyers (QIBs), however, bid for just 5,724 shares.
Smartworks shares were trading at a premium of Rs 30–32 in the grey market, up from Rs 25–27 before the IPO launch. This reflects a grey market premium (GMP) of about 7.4%, compared to around 6% earlier.
The company is aiming to raise between Rs 576 crore and Rs 583 crore through a mix of a fresh issue and an offer for sale. The IPO is open for subscription until July 14, with the listing scheduled for July 17 on the BSE and NSE.
The issue includes a fresh equity issue worth Rs 445 crore and an offer for sale of 33.79 lakh shares. The price band has been set at Rs 387–407 per share, with an employee discount of Rs 37. Investors can bid in lots of 36 shares and in multiples thereafter.
Of the net proceeds, Rs 225.8 crore will be used for fit-outs and security deposits at new centres, while Rs 114 crore has been allocated for debt repayment. The remainder will be used for general corporate purposes.Founded in 2015, Smartworks is India’s largest managed workspace operator by leased area, with over 8.99 million sq ft spread across 50 centres in 15 cities as of March 31, 2025. It also operates two centres in Singapore.The company primarily caters to mid-to-large enterprises across sectors such as IT, BFSI, and startups. Operating on a straight lease model, Smartworks is gradually incorporating variable rental agreements to enhance cost efficiency.
Smartworks has demonstrated robust revenue growth, with operational income nearly doubling from Rs 711.39 crore in FY23 to Rs 1,374.05 crore in FY25. EBITDA improved significantly to Rs 857.26 crore in FY25. However, the company remains loss-making, reporting a net loss of Rs 63.17 crore in FY25, although margins have been improving.
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As of March 2025, the company had an occupancy rate of 83.1%, catering to 738 enterprise clients across a total seating capacity exceeding 2 lakh.
In addition to its core offerings, Smartworks provides value-added services such as wellness zones, convenience stores, and design-build (FaaS) solutions to strengthen its enterprise-focused strategy.
The IPO is being managed by JM Financial, BOB Capital Markets, IIFL Securities, and Kotak Mahindra Capital.
Should You Subscribe? Analysts at Anand Rathi believe the IPO is fully priced and have assigned a “Subscribe – Long Term” rating. The brokerage notes that at the upper price band, the company is valued at a price-to-sales (P/S) ratio of 3.3x, with an EV/EBITDA of 9.7x and a post-issue market cap of Rs 46,448 million.
SBI Securities, on the other hand, has issued an “Avoid” rating for the IPO. The firm believes that other players like Awfis Space Solutions offer better investment opportunities in the coworking space, as Awfis is currently profitable and trades at a FY25 EV/Adjusted EBITDA multiple of 26.5x.
Bajaj Broking has recommended a “Subscribe for Long Term” rating, citing Smartworks’ position as a leading provider of office experience and managed campus platforms, with a focus on long-term contracts with MNCs.
While the company has shown strong top-line growth and positive cash EBITDA at the gross level, it continues to report net losses due to provisioning under new accounting standards. Smartworks operates with high lease liabilities under fixed-cost agreements across centres, leading to significant interest and depreciation expenses under Ind AS 116. This accounting treatment boosts EBITDA but exerts pressure on net profitability.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)