Awfis eyes IPO by next yr; plans to raise ~500-600 cr

Co-working solutions provider Awfis Space Solutions, is eyeing to raise ~500-600 crore via IPO by next year and use proceeds for growth and expansion and for exit of shareholders, if they intended to do so, company executives said.

The company, which has investments from Chryscapital and Sequoia, may also see partial exit from investors during the IPO.

“Our business will be worth about ~1,000 crore when we touch the public market and have over 200 centres. With a robust growth mechanism and higher return on capital employed and strong fundamentals, I feel that IPO will do well as our fundamentals are strong,” said Amit Ramani, co-founder and CEO, Awfis.

Sequoia India, which has done three funding rounds with the firm at Series B, Series C and Series C1 levels, has invested ~170-175 crore in the firm and Chryscapital has invested around ~200 crore in the business.

Awfis ended FY22 with an annual revenue rate (ARR) of ~400 crore. With ~33-34 crore monthly returns, the company now aims to touch ~60 crore by December and ~82 crore by March 2023. At the Ebitda-level, the company is close to around 32-35 per cent and aims to be Pat-positive by December. “Our success mantra has been our unique business model, the managed aggregation model, which has been able to provide an edge due to its unique proposition, wherein we partner with space owners of underutilised commercial spaces and strike a deal — where space owner makes the investment on fit-out infrastructure and builds out a centre,” Ramani said.

After surviving the pandemic, Awfis is on an expansion mode. From 50 centres with 30,000 seats in 2015, it has more than doubled its capacity to 131 centres and 75,500 seats. Moreover, it plans to add another 150 centres with 100,000plus seats in the next couple of months.

“In India, of a billion square feet, only 300 million square feet is with institutional landlords, and the other 700 million square feet is with family offices, and is under-serviced. We realised that we had to develop this model in India with a supply side strategy, as demand is not in our control, but supply is,” said Ramani.

The company has recently expanded its presence in Pune, Kolkata, Mumbai, Delhi, Hyderabad, among other places. “Awfis, has leased 30,000 seats and 2 million+ sq. ft. during the past five months and has crossed pre-pandemic seat sales,” says Ramani.