Smartworks Takes First Step Towards IPO, Turns Into A Public Company

Taking the first step towards its initial public offering (IPO), coworking startup Smartworks has turned into a public company. 

The startup has changed its name to Smartworks Coworking Spaces Ltd from Smartworks Coworking Spaces Private Ltd previously, as per its regulatory filing with the Registrar of Companies (RoC).

“… Considering the significant expansion of business activities, it has become necessary to convert the company into a public limited company… The board of directors of the company in its meeting held on June 21, 2024 has approved and recommended the resolution… for the approval of the members of the company as a special resolution,” the regulatory filing said.

The startup’s shareholders subsequently passed the special resolution on June 28. 

The company has also amended its memorandum of association (MoA) and the articles of association (AOA) to give effect to its plans to turn into a public company. 

Smartworks attributed the move to turn public to the “need to access both equity and debt capital markets” for expanding the company’s operations. 

“The expansion of the company’s operations in recent years has led to a substantial increase in its size and the need to access both equity and debt capital markets. Therefore, considering the significant expansion of business activities, it has become necessary to convert the company into a Public Limited Company,” the filing added. 

The development was first reported by Entrackr. 

A few days ago, the coworking startup announced that it raised $20.24 Mn from investors such as Keppel, Ananta Capital, Plutus Capital, family trusts, and other angel investors. 

Founded in 2016 by Neetish Sarda and Harsh Binani, Smartworks is a shared workspace provider that offers customisable coworking solutions for enterprises. 

The startup claims to have over 8 Mn sq. ft. of office space across 40+ locations spanning 14 cities including Bengaluru, Kolkata, Delhi NCR and Mumbai. It claims to cater to more than 600 enterprises, including Honeywell, Starbucks Coffee, DHL, and Moglix. 

Smartworks also bagged $25 Mn in its Series A funding round from Keppel Land in 2019. 

The coworking startup reported a net loss of INR 101 Cr in the financial year 2022-23 (FY23), up 44% year-on-year (YoY). Meanwhile, operating revenue nearly doubled to INR 711 Cr during the year under review from INR 360 Cr in FY22. 

Smartworks competes against the likes of Awfis, WeWork India and IndiaQube.

The latest development comes at a time when a growing number of Indian startups are gearing up for their IPOs. Be it Swiggy or Ola Electric, new-age tech companies are looking to ride the positive market sentiment and growing investor appetite for bumper listings on the bourses. 

In the coworking space, Awfis listed at a premium of 12.8% on the BSE in May. 

Besides, recent reports also said that Embassy Group plans to list its coworking office platform WeWork India on the bourses within 18 months of acquiring US-based WeWork’s 27% stakeholding in the Indian entity. Last month, the Competition Commission of India (CCI) cleared the deal.