IPO Size: Rs. 3,000 cr, Entirely Offer for Sale (OFS)   

• 76% of OFS by the promoter Embassy Group of Bengaluru (76% stake to drop to under 50% post IPO)
• 24% of OFS by the public shareholder WeWork Global (23% stake to drop to 15%)

Price band: Rs. 615-648 per share

M cap: Rs. 8,685 cr, implying 35% dilution

• 75% reserved for QIBs and only 10% for retail, as company reported losses

IPO Date: Fri 3^rd Oct to Tue 7^th Oct 2025, Listing Fri 10^th Oct 2025

Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.

Only Partly-Owned by WeWork Global

WeWork India, majority owned by realtor Embassy Group, is a 8 year old operator of flexible work spaces, with 1.2 lakh seats, as of 30.6.25, of which, 1.1 lakh are operational. 45% revenue comes from Bengaluru and 23% from Mumbai, for his 8 year old company. Management fee of ~3% revenue is paid to WeWork Global for brand use, which had earlier filed for Chapter 11 Insolvency in US, and later came out of it. Anything adverse development like Chapter 7 Insolvency will impact WeWork India adversely.

Comparison with Smartworks, Indiqube and Awfis

• Business Model: WeWork, Indiqube, Smartworks operate on straight line lease model (beneficial over long term in upturn cycle), whereas Awfis is managed aggregation model (property owner shares capex and rental income, providing downside protection).
• Number of Operational Seats: WeWork ranks #4 in the pecking order among listed co-working companies, as of 30.6.25 - Smartworks (1.9 lakh), Indiqube (1.4 lakh) and Awfis (1.4 lakh).
• Occupancy Rate: 76% occupany is lower than both Smartworks’ 83% and Indiqube’s 85%. Even on higher number of seats, Smartworks and Indiqube have better occupancy, whereas WeWork’s occupancy has been declining from 84% in FY23 to 76% in Q1FY26.
• Steady State Occupancy: 81% occupancy for mature centres (operational for 12+ months) is also below Smartworks (89%), Indiqube (87%) and (Awfis (84%). Low and Reducing occupancy is quite worrisome, for this fixed cost business, impacting returns, and severely hurting in a downturn.
• Highest Realisation Per Seat: Industry-leading at ~Rs. 19,800 per month, about 60% higher than industry, resulting in Rs. 1,949 cr topline in FY25, as against Rs. 1,100-1,400 cr for 3 peers. Adjusted EBITDA margin falls in upper end of 14-18% bracket.
• Inefficient Use of Capital: WeWork India is an 8 year old company, having deployed over Rs. 2,200 cr equity, including Rs. 500 cr via rights by the promoter in Jan 2025. In the business. On the other hand, Indiqube has raised only Rs. 320 cr equity till IPO, while Smartworks Rs. 500 cr and Rs. 400 cr for Awfis. Even if fresh issue component of IPO of peers is included, WeWork has required much more than double equity of peers, indicating poor capital utilization.

Q1FY26 Margins Decline

FY25 revenue stood at Rs. 1,949 cr, up 17% YoY. Despite Q1FY25 revenue up 19% YoY to Rs. 535 cr, adjusted EBITDA (for rent cost under IndAS) was flat at Rs. 97 cr, contracting margin to 18%, from ~22% in FY25. Reported PAT of Rs. 128 cr in FY25, mainly due to deferred tax credit of Rs. 286 cr. Adjusted PAT (under i-gaap) is positive, but not disclosed. But adjusted net margin is likely to be in single-digit (similar to 4.5-7.5% for peers), due to higher depreciation on account of premium location of centers and higher investment in furnishing and fittings.

Fully Priced IPO

Based on annualized Q1FY26 adjusted EBITDA of Rs. 97 cr, current year EV/EBITDA multiple of 23x is seen higher than both Indiqube’s 18x and Awfis’ 22x and closer to Smarworks’ 25x, making the IPO fully valued.

WeWork’s falling occupancy overshadows its industry-leading realization. Moreover, IPO is 100% OFS, with the promoter stake falling below 50%, coupled with a very large dilution.

Co-working is a crowded market with over 500 players and low entry barrier may not subside competition. WeWork enjoys high consumer recall, but financial and IPO valuation are not investor-friendly.