Awfis, a leading office space-sharing company in India, plans to expand into new markets while strengthening its presence in existing ones. According to Amit Ramani, the company’s chairman and managing director, this includes strategically targeting smaller cities for early investment.
“Our approach will be to have a controlled and methodical expansion of markets,” Ramani told analysts during a post-earnings call. “We will continue to invest in markets where we believe there are strong returns in the long term… We will also make strategic early investments in tier II cities.”
Awfis boasts a strong presence across India, with 181 centers in 17 different cities. This network offers 110,000 seats and covers a significant 5.6 million square feet of workspace. As of March 2024, they have established themselves in eight tier-II cities, including Ahmedabad, Jaipur, Nagpur, Chandigarh, Bhubaneshwar, Indore, Kochi, and Guwahati. This focus on major and developing areas highlights their commitment to widespread accessibility.
“Currently, we have approximately 95,000 operational seats. We plan to add around 40,000 new seats in FY25, reaching a total of approximately 135,000 seats by the end of FY25,” Sumit Lakhani, deputy chief executive officer of Awfis, said.
The company aims to increase its revenue by 30% in FY25, driven by supply expansion and higher occupancy rates at its existing operational centres. “Due to an increase in occupancy and operating leverage on cost, we should be able to improve our Ebitda margins by approximately 1.5% for FY25,” Lakhani said.
Awfis’s financial performance for FY24 shows positive signs. In Q4 FY24, the company turned a corner, reporting a net profit of Rs 1.3 crore compared to a loss of Rs 13.8 crore in Q4 FY23. This swing to profitability was accompanied by a strong growth in operating revenue, which increased by 45% year-on-year to Rs 232.3 crore in Q4 FY24.
Looking at the full year FY24, Awfis’s performance is even more encouraging. The company’s operating revenue reached Rs 848.8 crore, representing a 55.7% increase from Rs 545.2 crore in FY23. It also reduced its losses by 62.4% in FY24, reporting a loss of Rs 17.5 crore compared to Rs 46.6 crore in FY23. These financial results suggest that Awfis’s business strategy is starting to pay off.
Following a successful IPO on May 30th, Awfis entered the stock market. The company raised Rs 128 crore in fresh capital through this Rs 599-crore IPO. Existing investors, Peak XV Partners and ChrysCapital, also offloaded a portion of their shares during the offering – 6.6 million and 5.6 million shares, respectively.
Awfis’s debut on the stock exchange was positive. Their shares began trading on the NSE at Rs 435, a 13.58% increase over the IPO price of Rs 383. This momentum continued as the stock closed at Rs 501 on the BSE on Thursday, marking a slight increase from the previous day’s closing price.
While the global co-working space market might face challenges, India’s co-working sector appears to be progressing.
