WeWork India IPO gets SEBI nod; entire issue to be OFS

WeWork India Management Limited has received approval from the Securities Exchange Board of India (SEBI) to float its Initial Public Offering. The IPO will be a pure offer for sale (OFS) of up to 4.37 crore equity shares, enabling a partial exit opportunity for its promoter and existing investor.

According to its Draft Red Herring Prospectus, Embassy Buildcon LLP, the promoter entity, will offload 3.34 crore shares. At the same time, 1 Ariel Way Tenant, an affiliate of WeWork Global, will sell up to 1.03 crore shares.

The IPO will be managed by JM Financial, ICICI Securities, Jefferies India, Kotak Mahindra Capital, and 360 ONE WAM.  Since the issue is a pure OFS, WeWork India will not receive any proceeds from the offer for sale.

As per the DRHP, Embassy Buildcon held 73.82% stake in WeWork India, while 1 Ariel Way Tenant owned 22.72% at the time of filing.

WeWork India, the exclusive licensee of the WeWork brand in the country, is majority-owned by real estate giant Embassy Group. It operates 94,440 desks across 59 centers in major cities like Bengaluru, Mumbai, and Delhi-NCR, with 93% of its portfolio made up of Grade A properties. 

Backed by a top real estate developer, it has led the segment by revenue for the past three years. In the first half of FY25, WeWork India reported a revenue of Rs 918 crore and a profit before tax of Rs 60.3 crore. For the full fiscal year ending March 2024 (FY24), the Bengaluru-based company posted Rs 1,651 crore in revenue but recorded a net loss of Rs 136 crore.

In the co-working space, WeWork India competes with Awfis, Indiqube, Innov8, AlfF, LiquidSpace, 91springboard, and others. Awfis debuted on the stock exchange in May last year and is currently trading at Rs 633 with a total market capitalization of $529 million. Another co-working startup, Smartworks, closed its subscription for the public on the 14th and will be listed on the exchange this week.