| Q2 Revenue | ₹591.37 CrUp 39.2% YoY |
|---|---|
| Market Cap | ₹5,440.54 CrMid-cap |
| Contracted Revenue | ₹5,800 CrOrder Book |
| P/E Ratio | 96.03xSector 33.8x |
Key highlights
- Operating revenue for Q2 FY27 reached ₹591.37 crore, marking a 39.2% increase year-on-year.
- Management raised the full-year FY27 revenue growth guidance to 33-35% from the previous 28-30%.
- Net profit for the quarter surged to ₹25.64 crore, a massive rise from ₹2.52 crore in the previous year's quarter.
- Contracted revenue visibility improved to over ₹5,800 crore compared to ₹5,400 crore in the prior quarter.
- Enterprise clients now contribute 91% of total rental revenue, with significant growth from Global Capability Centers (GCCs).
Sequential Growth and Margin Expansion
Smartworks Coworking Spaces recorded its sixth consecutive quarter of sequential growth since its listing, with Q2 revenue rising 8.3% over the previous quarter to ₹591.37 crore. The company reported a significant surge in profitability, with normalized net profit reaching ₹43 crore, up 136% year-on-year. This performance was driven by the maturation of older centers, allowing profits to grow faster than top-line revenue.
Normalized EBITDA margins stood at 19.8%, representing a 340 basis point improvement compared to the same quarter last year. Despite the growth, the stock currently trades at a TTM P/E of 96.03x against the industry average of 22.83x.
Upgrade in FY27 Revenue Guidance
- Full-year FY27 revenue growth guidance increased to 33-35% from the earlier range of 28-30%.
- Contracted rental revenue stands at ₹5,800 crore, providing visibility beyond the current fiscal year.
- Operational space expanded to 10.9 million square feet across 58 centers by September 30, 2026.
- Company added 11,500 seats of capacity during the quarter to meet strong pipeline demand.
- Occupancy in mature centers remained stable at 88% with committed occupancy at 91%.
- Annual rental escalations continue to trend between 5% and 6%.
Flagship Campus Launches in Pune and Mumbai
The company is entering its heaviest capital expenditure cycle to date, with ₹307 crore deployed in H1 FY27. This investment is primarily focused on two upcoming flagship campuses scheduled for commissioning in the second half of the fiscal year. The Eastside campus in Pune, covering 863,000 square feet, and the Eastbridge campus in Mumbai, covering 815,000 square feet, are both expected to go live by March 2027.
While these launches may cause a temporary dip in overall occupancy due to the expanded denominator, management indicated that pre-commitments are already at 35% for these new locations.
Neetish Sarda on Flex Workspace Demand
Uncertainty is exactly why flex is winning. When companies are unsure how fast they will grow, they do not want to lock in long leases and large upfront spending. Flex gives them ready-to-use space that they can scale up and down.
Leverage and Cash Flow Dynamics
Aggressive footprint expansion has shifted the company's balance sheet position. Net debt increased to ₹83 crore by the end of September 2026, diverging from the previously guided 'virtually debt-free' status. High capital expenditure and security deposits for new centers outpaced operational cash flow, resulting in a negative free cash flow of ₹104 crore for the first half of the year.
Management maintains that this is a temporary trend caused by investment arriving before revenue, noting that mature centers are yielding strong returns on capital employed (ROCE) of 21.6%.
| Date | Announcement | Amount |
|---|---|---|
| 22 Jul 2026 | Management reaffirmed FY27 revenue growth guidance of 28%–30% on Q1 earnings callSource: multibagg.ai | – |
| 22 Jul 2026 | Q1 FY27 consolidated revenue from operationsSource: NSE filing | ₹546.25 Cr |
| 30 Apr 2026 | Q4 FY26 consolidated revenue from operationsSource: equitybulls.com | ₹519.68 Cr |
| 15 Jan 2026 | Q3 FY26 consolidated revenue from operationsSource: equitybulls.com | ₹472.13 Cr |
What to watch next
- Commissioning of Pune Eastside flagship campus by March 31, 2027
- Commissioning of Mumbai Eastbridge flagship campus by March 31, 2027
- Recovery of blended occupancy levels above the 80% mark following H2 launches
- Tracking net debt levels against the 13 million square feet operational milestone
“Our free cash flow will turn positive as our mature base approaches 13 million square feet, which should happen down the line in the next few quarters.”
| Share price | ₹475.65 |
|---|---|
| Market capitalisation | ₹5,440.54 Cr |
| Revenue (annual) | ₹1,795.80 Cr |
| Net profit (annual) | ₹10.53 Cr |
| Revenue (latest quarter) | ₹591.37 Cr+8.26% vs previous quarter |
| Net profit (latest quarter) | ₹25.64 Cr+95.02% vs previous quarter |
| P/E (TTM) | 96.03×Sector 33.81× |
| Promoter holding | 58.26%-0.06% QoQ |
| FII holding | 0.36%Current quarter |
Reference market data from a third-party provider, as of the story. Not a valuation or a recommendation.
Exchange filing by Smartworks Coworking Spaces Ltd. announcing Q2 FY27 financial results and guidance revision. Market figures from a third-party data provider.
