AWFIS

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

By Ujjaini Dutta

BENGALURU, July 30 (Reuters Breakingviews) - WeWork’s latest push for an initial public offering sounds a bit too familiar. The coworking space’s India affiliate is preparing for a Mumbai share sale. It has improved on the business model of its global namesake which commanded a $47 billion valuation before scrapping its planned IPO in 2019. Nonetheless, it looks like another rushed attempt at a stock market listing from the brand.

As a separate entity, WeWork India was unscathed by WeWork Global's entry into bankruptcy proceedings in 2023. It counts the company as a minority investor and pays it a management fee, recently renegotiated down to 2.84% of revenue. Embassy Group, a Bengaluru-based developer, owns 74% of the firm.

The franchisee stands apart in other ways, too. For a start, it is profitable. WeWork Global was racking up billions of dollars of losses ahead of its IPO push. By contrast, WeWork India turned a small net profit in the six months to September 2024.

The franchisee's business looks more disciplined too. Its centres are in top cities like Bengaluru where demand has kept occupancy rates well over 80%, according to property consultancy Knight Frank. Its tenants include JP Morgan JPM.N and Thomson Reuters TRI.TO, the parent of Reuters Breakingviews.

And the company is experimenting with ways to reduce costs: in three of its 59 centres, landlords cover operating and setup costs for a cut of the revenue; another five run on fixed-fee services. The relationship with Embassy Group, also a partner to Blackstone BX.N, makes it easier for WeWork India to access prime office real estate too.

On a multiple of 3.65 times 2026 sales, the same as Peak XV Partners-backed local rival Awfis Space Solutions AWFI.NS, WeWork India’s enterprise might be worth $814 million. Yet that would be nearly double the valuation that was mooted in local media in April last year, and about twice the multiple of London-listed International Workplace Group IWG.L which has over 4,000 workspace locations globally.

WeWork India is also going public in what looks like an increasingly crowded market. The Executive Centre, backed by KKR KKR.N, is preparing to list, too. Smartworks Coworking Spaces SMAW.NS debuted earlier this month. What's more, none of the proceeds from the global brand's potential $400 million offer will go to the company: it's just an opportunity for existing investors to cash out. Given the difficult history of the brand, WeWork India should have delayed its IPO until it proved itself a bit more.

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CONTEXT NEWS

WeWork India has begun marketing its initial public offering, which is expected to raise as much as 35 billion rupees ($407 million), Bloomberg reported on July 17, citing people familiar with the matter. The coworking space provider aims to launch the deal in August.

The company is owned by Indian real estate firm Embassy Group and 1 Ariel Way Tenant, an affiliate of WeWork Global. The offering will be comprised entirely of existing shares, according to WeWork India's prospectus.

(Editing by Una Galani; Production by Aditya Srivastsav)

((For previous columns by the author, Reuters customers can click on DUTTA/[email protected]))

Adds details and background from paragraph 2 onwards

July 17 (Reuters) - Smartworks Coworking Spaces' SMAW.NS shares climbed 14% in their trading debut in Mumbai, valuing the company at 52.96 billion rupees (about $617 million) as investors bet on rising demand for integrated office solutions in India.

The provider of integrated enterprise workspaces opened at 435 rupees, above its issue price of 407.

Smartworks' IPO comes amid strong demand for commercial space in India, following two consecutive years of record office leasing activity and as global companies expand their presence in India.

This has propelled India into becoming Asia-Pacific's top office market, along with Japan and Singapore, according to real estate services provider CBRE.

Smartworks' $67.9 million initial public offering was subscribed 13.45 times over three days, largely by qualified institutional buyers, including foreign investors, domestic banks, insurers and mutual funds.

The firm competes with WeWork India Management WEWO.NS and Awfis Space Solutions AWFI.NS in the domestic market.

($1 = 85.8480 Indian rupees)

(Reporting by Manvi Pant; Editing by Vijay Kishore)

(([email protected]; +918447554364;))

June 2 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• AWFIS SPACE SOLUTIONS LTD - SANCTIONED RUPEE TERM LOAN FACILITY OF 800 MILLION RUPEES

Further company coverage: AWFI.NS

(([email protected];))

Feb 19 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• TAX AUTHORITY ORDERS PROVISIONAL ATTACHMENT OF AWFIS BANK ACCOUNTS

• NO FINANCIAL IMPACT ON AWFIS DUE TO ORDER

Source text: ID:nBSEbpXhjR

Further company coverage: AWFI.NS

(([email protected];;))

Feb 11 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• DEC-QUARTER CONSOL PROFIT 151.8 MILLION RUPEES

• DEC-QUARTER CONSOL REVENUE FROM OPERATIONS 3.18 BILLION RUPEES

Source text: ID:nNSE9yyVzf

Further company coverage: AWFI.NS

(([email protected];;))

Nov 11 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• SEPT-QUARTER CONSOL PROFIT 386.7 MILLION RUPEES

• SEPT-QUARTER CONSOL REVENUE FROM OPERATIONS 2.92 BILLION RUPEES

Source text: ID:nNSE1XN5Yh

Further company coverage: AWFI.NS

(([email protected];;))

Sept 18 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• AWFIS SPACE SOLUTIONS - LAUNCHED NEW CENTRE IN GIFT CITY, GANDHINAGAR

Further company coverage: AWFI.NS

(([email protected];))

** Shares of Awfis Space Solutions AWFI.NS jump as much as 7.4% to 824 rupees

** Co, which caters to flexible workspace needs, partnered with Nyati group, a real estate firm, for additional 300,000 sq. ft. of workspace

** Stock set to snap a two-day losing streak, but on track to break a four-week rally

** Including day's move, AWFI has risen ~80% YTD

(Reporting by Yagnoseni Das in Bengaluru)

(([email protected];))

Aug 27 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• SIGNS MANAGED AGGREGATION DEAL OF 300,000 SQ FT WITH NYATI GROUP

Source text for Eikon: ID:nBSE549Lt4

Further company coverage: AWFI.NS

(Reporting by VijayDattaram Malkar)

(([email protected];))

** Shares of Awfis Space Solutions AWFI.NS jump 9.3% to record high of 862 rupees

** Co, which caters to flexible workspace needs, launches two new centres in Bengaluru city

** AWFI plans to add 40,000 seats in FY25; its current seat count is ~112,000

** Stock set for fourth straight weekly gain if trends hold

** Volume of shares traded is 1.4x 30-day avg

** Including day's move, AWFI has more than doubled since listing in end-May

(Reporting by Hritam Mukherjee in Bengaluru)

(([email protected];))

** Shares of India's Awfis Space Solutions AWFI.NS rise ~5% to 704 rupees

** AWFI, which caters to flexible workspace needs, posted Q1 consol profit of 27.9 mln rupees (about $332,321) vs loss a yr ago; rev jumped 37%

** Trading vols 2.4x 30-day avg

** YTD stock has gained 67% since listing in end-May

($1 = 83.9550 Indian rupees)

(Reporting by Hritam Mukherjee in Bengaluru)

(([email protected];))

May 15 (Reuters) - Awfis Space Solutions Ltd AWFI.NS:

• REVISES FRESH ISSUE SIZE FOR IPO TO 1.28 BILLION RUPEES FROM 1.60 BILLION RUPEES EARLIER - PROSPECTUS

• OFFER FOR SALE REVISED TO 12.3 MILLION SHARES FROM 10.02 MILLION SHARES EARLIER

Source text for Eikon: [ID:]

Further company coverage: AWFI.NS

(([email protected];))