[Update] Smartworks IPO: Issue Subscribed 50% On Day 1

Update | July 10, 08:20 PM

The IPO of Smartworks was subscribed 50% on the first day of bidding, with non-institutional investors (NIIs) leading the pack. The public issue received bids for 52.25 Lakh shares as against 1.04 Cr shares on offer.

The portion reserved for NIIs was completely subscribed, receiving bids for 22.14 Lakh shares against 22.17 Lakh shares on offer. 

The portion reserved for retail investors got bids for 29.56 Lakh shares as against 51.73 Lakh shares on offer, translating to 57% subscription. 

Employees bid for 49.9K shares out of the 1.07 Lakh shares reserved for them. This meant 47% subscription on the employee front.

Bidding by qualified institutional buyers (QIBs) remained negligible, with only 5,220 bids received against a total reserve of 29.03 Lakh shares. 

Original | July 10, 12:53 PM

The IPO of managed workspace provider Smartworks got off to a slow start, with the issue subscribed 17% till 12 PM on the first day of bidding.

According to the BSE data, the IPO received bids for 17.22 Lakh shares as against 1.04 Cr shares on offer.

The portions reserved for non-institutional investors (NIIs) and employees saw the highest demand, with both segments getting subscribed 25%.

While NIIs placed bids for 5.6 Lakh shares compared to 22.17 Lakh shares reserved for them, employees placed bids for 26,532 shares against 1.07 Lakh shares on offer.

Retail investors bid for 11.31 Lakh shares against 51.73 Lakh shares on offer, translating to 22% subscription. 

As is generally the case, qualified institutional buyers (QIBs) showed a tepid response on the first day. They placed bids for only 3,492 shares against 29 Lakh shares on offer.

Smartworks has set a price band of INR 387 to INR 407 for its IPO, which comprises a fresh issue of shares of up to INR 445 Cr and an OFS component of up to 33.79 Lakh shares. The bidding will close on July 14, with the company’s shares expected to list on July 17.

At the upper end of the price band, Smartworks will be valued at about INR 4,650 Cr (around $540 Mn). 

The proceeds from the IPO will be used to repay borrowings, fuel capital expenditure towards security deposits and development of new centres. 

Yesterday, Smartworks raised INR 173.64 Cr in its anchor round from Tata Mutual Fund, Baroda BNP Paribas, and Trust Mutual Fund, Aditya Birla Sun Life, Axis Mutual Fund, SBI General Insurance, Societe Generale and Buoyant Capital.

Founded in 2016 by Neetish Sarda and Harsh Binani, Smartworks is a managed workspace provider. It leases large buildings from landlords, converts them into campuses, and then rents them out to large enterprises. It maintains an average lease tenure of 48 months and currently manages 10 Mn sq ft of space.

Beyond leasing, Smartworks earns a small portion of its income from services such as meeting rooms, internet access, parking, electricity, and other client-used amenities.

On the financial front,  its net loss jumped 26.5% year-on-year (YoY) to INR 63.2 Cr in FY25 and operating revenue grew 32% YoY to INR 1,374 Cr. Smartworks’s management said that the company will achieve breakeven at the unit-building level in the next 12 months.