Smartworks Coworking Spaces establishes IPO share price range: ₹387

In the rapidly evolving world of coworking spaces, Smartworks Coworking Spaces Ltd stands out as a pioneer, focusing on leasing large, bare-shell commercial properties in prime locations and transforming them into fully serviced, tech-enabled coworking campuses with modern amenities. The company's business model primarily caters to high-ticket enterprise clients and growing mid-to-large businesses, setting it apart within the coworking sector.

### Key Features of the Business Model

Smartworks' business model is centred on leasing large office spaces rather than owning properties. The company emphasises technology infrastructure, cost efficiency, and operational processes to deliver a superior customer experience and maintain capital efficiency. This focus on enterprise-level clients offers stable and high-value rental revenue streams, underpinning the company's financially stable model with a focus on risk mitigation, including careful lease management and operational controls.

### Key Growth Strategies

Smartworks' growth strategies revolve around capital expenditure on new centres, geographical expansion in key metro markets, a focus on large, amenity-rich campuses, technological enhancements and operational efficiencies, and financial execution and risk mitigation. The company invests significantly in fit-outs and security deposits for new office centres to expand its footprint and enhance user experience.

The company is also leveraging its presence in important metropolitan areas to grow its presence among large businesses requiring quality office space. Building or converting larger spaces to attract bigger clients with high-end needs supports revenue growth through long-term leases. A strong emphasis on technology infrastructure for streamlined operations and cost efficiency helps maintain profitability and scale effectively.

The use of IPO proceeds for reducing borrowings and funding expansion helps maintain a sound financial position, enabling sustainable growth. JM Financial Ltd, BOB Capital Markets Ltd, IIFL Securities Ltd, and Kotak Mahindra Capital Company Ltd are responsible for managing the company's IPO process.

### IPO Details

Smartworks has revised its IPO size downward to ₹445 crore from the earlier planned ₹550 crore. The company shares are expected to be listed on July 17 on the BSE and NSE, with bidding for anchor investors opening a day before, on July 9. The IPO is scheduled to open for public subscription on July 10 and conclude on July 14.

The company's strong pan-India presence, competitive pricing, and ability to lease entire or large properties make it a preferred partner for mid-to-large enterprises. This is reflected in the 20.80 per cent CAGR in space managed and a 38.98 per cent CAGR in revenue from operations during the same period.

Proceeds from the fresh issue will be used for capital expenditure related to the fit-outs in new centres and security deposits for these new centres (₹226 crore), payment of loans (₹114 crore), and general corporate purposes. Smartworks Coworking Spaces Ltd has fixed a price band of ₹387-407 per share for its ₹583 crore Initial Public Offering (IPO).

The company's campuses, located in cities including Bengaluru, Mumbai Metropolitan Region, Hyderabad, Gurugram, and Chennai, include cafeterias, sports zones, gyms, medical centres, and more, providing a comprehensive and comfortable work environment for its clients.

As Smartworks Coworking Spaces Ltd prepares for its IPO, it continues to expand its operations, offering a high-quality, tech-enabled coworking solution to businesses of all sizes, with a focus on mid-to-large companies that need over 300 seats. The company's growth and success demonstrate the potential of the managed office solutions business model in the Indian market.

Smartworks Coworking Spaces Ltd's business model, centered on leasing large office spaces, focuses on technology, efficiency, and a superior customer experience for enterprise-level clients, providing stable and high-value rental revenue streams.
As part of its growth strategies, Smartworks invests significantly in new office centers, technological advancements, operational efficiencies, and financial execution, aiming to expand its footprint and enhance user experience.
Proceeds from the IPO of Smartworks Coworking Spaces Ltd will be used for capital expenditure on new centers, loan repayments, and general corporate purposes, supporting its continued expansion and financial stability.
Smartworks' campuses, with amenities like cafeterias, sports zones, gyms, and medical centers, offer a comprehensive and comfortable work environment, catering to businesses of all sizes, particularly mid-to-large companies requiring over 300 seats.