Financial Performance Highlights

Q2 FY27 Performance (Quarter ended September 30, 2026):

  • Reported revenue (IndAS): ₹439 crores, up 20% YoY
  • Normalized revenue: ₹451 crores, up 26% YoY
  • Reported EBITDA: ₹174 crores, up 31% YoY with margin of 39.6%
  • Cash EBITDA: ₹49 crores, up 45% YoY with margin of 10.8%
  • Profit before tax: ₹31 crores, up 91% YoY
  • Operating PBT: ₹13 crores

H1 FY27 Performance (Half year ended September 30, 2026):

  • Reported revenue (IndAS): ₹864 crores, up 23% YoY
  • Normalized revenue: ₹888 crores, up 30% YoY
  • Reported EBITDA: ₹336 crores, up 30% YoY with margin of 38.9%
  • Cash EBITDA: ₹93 crores, up 40% YoY with margin of 10.5%
  • Profit before tax: ₹56 crores, up 108% YoY
  • Operating PBT: ₹25 crores

Business Segment Performance:

  • Coworking & Allied Services Q2 revenue: ₹364 crores, up 22% YoY
  • Coworking & Allied Services H1 revenue: ₹715 crores, up 25% YoY
  • Transform (design & build) Q2 revenue: ₹75 crores, up 8% YoY
  • Transform (design & build) H1 revenue: ₹149 crores, up 16% YoY
  • Third-party clients now account for 93% of Transform revenue

Operational Metrics

Network Expansion (as of September 30, 2026):

  • Operational centers: 244 across 18 cities
  • Centers under fit-out: 10
  • Total supply: 254 centers
  • Signed LOIs: 270 centers
  • Operational seats: 164,000+ (from 159,000 at June end)
  • Total supply seats: 174,000 across 8.7 million square feet
  • Signed LOI seats: 188,000 across 9.4 million square feet

Q2 FY27 Seat Additions:

  • Added approximately 7,000 gross seats
  • Launched 6 new centers
  • Exited 2,200 seats across 4 centers as part of portfolio optimization

H1 FY27 Seat Additions:

  • Added approximately 12,000 gross seats
  • Launched 13 new centers
  • All new centers in Grade A or A+ assets in high-demand micro-markets

Occupancy Metrics:

  • Mature centers (operational >12 months) occupancy: 84.1% (vs 83% in Q1)
  • Blended portfolio occupancy: 76.2% (vs 76% in Q1)

Premium Portfolio Growth:

  • Gold and Elite centers: 39 (29 Gold + 10 Elite) vs 26 a year ago
  • Premium seats: 33,000, up 58% YoY
  • Gold centers: 29 vs 21 YoY, seats: 20,100 vs 14,800 YoY
  • Elite centers: 10 vs 5 YoY, seats: 13,000 vs 6,200 YoY
  • Premium seats signing at ~35% higher pricing than flagship product

Client Base Analysis:

  • Active clients: over 3,700
  • Weighted average client tenure: 38 months
  • Lock-in tenure: 27 months (up from 26 months at June end)
  • For clients with >100 seats: tenure 49 months, lock-in 33 months (up 3 months YoY)
  • 77% of seats have tenure ≥24 months, 18% between 12-23 months

Client Segmentation:

  • By type: Enterprises & MNCs 64%, SMEs 25%, Startups 10%
  • By industry: Technology 39%, Professional Services 20%, Manufacturing 13%, BFSI 12%, Healthcare & Life Sciences 7%
  • By domicile: India-headquartered 51%, North America 30%, Europe 14%
  • By size: Clients with ≥500 seats account for 37% of seats, clients with ≤100 seats account for 35%

GCC Business:

  • Serve 105+ unique GCC clients across 9 cities
  • GCC contribution: ~24% of rental revenue
  • Recent wins include Fortune 500 group GCC mandate for 1,000+ FTEs in Chennai

Growth Engines Update

1. GCC Demand: Focus on first-time entrants and scaling existing relationships

2. Premiumization at Scale: Gold/Elite portfolio expansion with higher realizations

3. Multi-format Supply: Managed aggregation (57% of centers), straight lease for premium assets, partial managed office

4. Organic Growth: Sold ~25,000 seats in H1, focus on longer lock-ins (up to 27 months)

5. Value Beyond Flex: Transform order book and advance pipeline at ₹220 crores

Financial Discipline & Balance Sheet

  • Net cash positive with net debt-to-equity of -0.12x (vs -0.08x at June end)
  • Net debt negative: ₹73 crores
  • Fixed asset turnover ratio: 1.5x
  • H1 FY27 Capex spend: ₹113 crores
  • Incremental cost of borrowing: 8.5%
  • Credit rating: A+ with stable outlook
  • Since listing (Q1 FY25): added 64,000 net operational seats (100,000 to 164,000) while deploying ₹460+ crores CAPEX from internal accruals
  • Only equity raised: ₹128 crore at IPO

FY27 Guidance Reiterated

  • Full-year gross seat addition: 22,000-25,000
  • Coworking revenue growth: 23-25%
  • Transform revenue growth: ~20%
  • Total revenue: past ₹1,800 crores
  • Cash EBITDA: ₹190-200 crores
  • Expected Q4 cash EBITDA margin: ~11.5%
  • Exit March cash EBITDA margin: ~12%

Transform Business Update

  • Order book and advance pipeline: ₹220 crores
  • H2 FY27 visibility: strong
  • FY27 target: ₹300+ crores revenue
  • Recent mandates: 40,000-100,000 sq.ft projects for global technology center, renewable energy group, pharmaceutical group, customer experience major

Ancillary Services

  • Ancillary income: 16% of space revenue
  • Expected growth: 25-30% over next 12 months
  • Components: IT services, F&B, center promotions, mobility products (day passes, virtual offices, meeting rooms)

Industry Context

  • India's Grade A office stock: 887 million sq.ft across top 7 cities
  • Q3 2026 gross leasing: 18.7 million sq.ft, up 7% YoY
  • Vacancy rate: 15.9% (down 42 bps)
  • Average quoted rents: ₹115/sq.ft/month, up 6.9% YoY
  • Flex workspace leasing: 12.6 million sq.ft in 9M 2026 (~25% of market)
  • GCC leasing: 8.7 million sq.ft in Q3 (41% of market), 28 million sq.ft in 9M (42% of market)
  • GCC concentration: Hyderabad 37%, Bangalore 28%, Chennai 11%, NCR 11%

#Tags: #Awfis #Q2Earnings #SEBIDisclosure #RegulatoryCompliance #FinancialUpdate #Neutral