WeWork India IPO

It is the largest operator in India's premium flexible workspace segment by total revenue over the last three fiscals. Its total income grew from ₹1,422.77 crore in FY23 to ₹2,024 crore in FY25.

It achieves premium pricing, demonstrated by its FY25 average portfolio level revenue to rent multiple of 2.7. This efficiency significantly exceeds the industry average range, which typically falls between 1.9 and 2.5.

The company has managed to cut down its borrowings significantly from ₹485.6 crore in FY23 to ₹310.2 crore as of March 2025. This could help reduce the financial cost and improve profitability.

A typical center achieves operational breakeven, recovering its operating costs, at a manageable 55.7% occupancy rate. This breakeven point is typically reached quickly, within four to six months of the center becoming operational, maximizing return on investment time.

Mature Centres (operational for over 12 months) showcase robust unit economics by operating at strong Centre Level EBITDA Margins exceeding 40%. Its total EBITDA margin for FY25 was 63.41%, highlighting overall operational efficiency.

It has significantly optimized its expansion costs, lowering the capital expenditure per desk to ₹1.33 lakh (₹132,665) in the three months ended June 30, 2025. This cost reduction drives greater Centre level returns on capital expenditure.

It is majority owned and promoted by the Embassy Group, recognized as a leading Indian real estate developer. This relationship provides essential real estate expertise and access to high-quality projects in Tier 1 cities.

It strategically focuses on premium locations, with approximately 94% (70.70 lakh square feet or 7.07 million sqft) of its portfolio residing in Grade A developments as of June 30, 2025. This concentration helps attract quality clientele in top-tier micro markets.

Its operational efficiency is high, evidenced by an EBITDA margin rising to 63.41% in FY25. Furthermore, its risk is mitigated by a diversified client base, where no single client accounts for more than 10% of its Net Membership Fees.

It is making this Offer under Regulation 6 (2) because it failed to meet SEBI's minimum financial requirements for the main board listing. Specifically, it lacked net tangible assets of ₹3 crore and a Net Worth of ₹1 crore during each of the preceding three fiscals.

Despite a recent profit, it has a history of losses, including a restated net loss of ₹146.81 crore in FY23 and ₹135.8 crore in FY24. Additionally, it again posted a loss of ₹14.15 crore during Q1 FY26.

The business model depends on long-term fixed cost lease agreements for an aggregate Leasable Area of 73.50 lakh square feet (7.35 million sqft) across 60 operational centers. These fixed rental payouts create a high financial burden regardless of occupancy levels or economic shifts.

Operational efficiency has dipped as the Occupancy Rate in Operational Centres consistently fell from 83.78% in FY23 to 76.48% in the three months ended June 30, 2025. This downward trend, if sustained, could pressure overall center profitability.

Its performance is heavily reliant on a few locations, with centers in Bengaluru and Mumbai generating 66.25% of its Net Membership Fees for the three months ended June 30, 2025. Any adverse developments in these two key cities could significantly harm operations.

The entire IPO is structured as an Offer for Sale of up to 4,62,96,296 Equity Shares by existing shareholders. Consequently, it will not receive any funds from the offer for expansion, debt repayment, or other growth purposes.

Statutory Auditors reported modifications for fiscals 2023, 2024, and 2025 concerning issues like missing audit trails and inadequate daily backups of books of account. Furthermore, a material weakness in internal financial controls related to vendor documentation was identified for FY23.