Smartworks Q2 Revenue Up 39% YoY, Raises FY27 Guidance

Date: 30th October, 2026

Financial Results (Standalone & Consolidated)

Q2 FY27 Performance:

• Revenue from operations: ₹5,914 Mn, up 39% YoY and 8% QoQ
• Normalised EBITDA: ₹1,169 Mn, up 68% YoY and 9% QoQ
• Normalised EBITDA Margin: 19.8%, up 340 bps YoY and 20 bps QoQ
• Normalised Profit Before Tax: ₹582 Mn, up 137% YoY and 12% QoQ
• Normalised Profit After Tax: ₹434 Mn, up 136% YoY and 12% QoQ
• Normalised Operating Cash Flow: ₹1,071 Mn, up 74% YoY and 13% QoQ
• OCF to EBITDA ratio: 0.9x (overall), >1.0x (operational centers)
• Normalised Annualised ROCE: 21.6%

H1 FY27 Performance:

• Revenue growth: 41% YoY
• Normalised EBITDA margin: 19.7%

Balance Sheet Highlights:

• Gross Debt: ₹2,337 Mn
• Net Debt: ₹827 Mn
• Q2 Capex: ₹1,556 Mn, up 64% YoY
• H1 Capex: ₹3,066 Mn deployed

Guidance & Outlook

Updated FY27 Guidance:

• Revenue growth guidance raised to 33-35% from previous 28-30%
• Normalised EBITDA margin guidance maintained at 19-20%, trending towards upper band
• Expected operational space by March 2027: 12.5-13 million sq ft
• Full-year capex guidance: ₹5,500-6,000 Mn

Operational Highlights

Supply & Capacity:

• Total operational area: 10.9 million sq ft across 58 centers
• Total secured footprint: 17.5 million sq ft across 71 centers, up 38% YoY
• Under fit-out or awaiting handover: 4.3 million sq ft
• H2 planned additions: 2.5-3.0 million sq ft

Key Campus Developments:

• Eastside, Kharadi, Pune: ~863,000 sq ft (Panchshil Realty partnership)
• Eastbridge, Vikhroli, Mumbai: ~815,000 sq ft (Hiranandani partnership)
• Sattva Aura, ORR Bengaluru: ~493,000 sq ft (Sattva Group partnership)

Client Metrics:

• Total clients: 785
• Clients with >1,000 seats: 35+
• Clients in multiple cities: 75+
• Largest client represents <5% of rental revenue
• Average tenure: 45 months (49 months for 1,000+ seat clients)
• Contracted rental revenue: ~₹58,000 Mn (up from ~₹54,000 Mn in June)

Q2 Client Wins:

• Contracts entered includes ~₹5,400 Mn contracted rental revenue
• Existing client expansion: ~₹2,350 Mn
• New client additions: ~₹3,050 Mn

Sector Diversification:

• IT/ITeS: ~36% of rental revenue (down from ~40% a year ago)
• Non-IT/ITeS: 77% of revenue added over last year
• Key growth sectors: consulting, engineering, manufacturing, BFSI

Occupancy Metrics:

• Overall occupancy: ~81%
• Committed occupancy: ~86% overall, ~91% across mature centers (9.7 Msf)
• New centers committed occupancy: ~48% and ramping
• Client lock-ins cover landlord rent commitments approximately 2x

Portfolio Age Analysis:

• 31% of operational SBA opened in last 24 months (3.4 Msf)
• Centers reach break-even occupancy in about 12 months
• Mature centers run at 88% occupied and 91% committed

International Operations

Singapore Business:

• 4 centers with ~1,600 seats
• Committed occupancy: ~86%
• EBITDA since handover: ~USD 2.5 Mn
• Represents ~2% of total revenue

Market Context

India Office Market (CBRE Research Q3 2026):

• January-September 2026 absorption: ~66.4 million sq ft, up 8% YoY
• Q3 2026 absorption: ~21 million sq ft
• Flexible space operators: 24% of all leasing (largest single sector)
• GCC leasing: ~28 million sq ft in first nine months (~42% of total absorption)
• 67% of occupiers plan to include flex in portfolios over next two years

Management Commentary

From Founders' Letter:

• Q2 FY27 marks sixth consecutive quarter of sequential growth since listing
• Strategy focused on securing large buildings early for future capacity
• Enterprise clients signing longer contracts and expanding across multiple locations
• ~20% of capital invested in buildings not yet operational, affecting headline ROCE
• Cash conversion expected to remain soft during expansion phase
• Free cash flow expected to turn positive once mature base approaches 13 million sq ft

Awards & Recognition

• GROHE Hurun India Real Estate Leadership Conclave & Excellence Awards 2026: Pioneer of the Year – Managed Workspaces
• CII Unicorn Summit 2026: Recognized for successful IPO journey