Awfis Gears Up for IPO Despite Losses in Recent Quarters

The year 2024 is witnessing a flurry of initial public offerings (IPOs) with several companies lining up to enter the stock market. Following the recent public listings of TBO Tek and Go Digit, Awfis is set to join them on May 22nd.

Awfis Financials: Revenue Growth Amidst Losses

While TBO Tek and Go Digit demonstrated profitability until the third quarter of FY24, Awfis reported a loss of Rs 19 crore during the same period. Backed by Peak XV, the company has revealed its financial results for the first three quarters ending December 2023 (Q1-Q3 FY24).

Awfis’s operating revenue for Q1-Q3 FY24 reached Rs 616 crore, reflecting growth compared to the total revenue of Rs 545 crore for the entire FY23. Founded in 2015, Awfis caters to startups, SMEs, and large corporations by offering customized office spaces along with supplementary services like food and beverage options, IT support, and infrastructure management.

Rental Services Drive Revenue

Rental services emerged as the primary revenue source for Awfis, contributing 64.7% of the total operating revenue, which stood at Rs 399 crore in Q1-Q3 FY24. Other sources of income included construction and fit-out projects, facility management services, and food sales. Additionally, non-operating activities generated Rs 17.1 crore, bringing Awfis’s total revenue for the first three quarters of FY24 to Rs 634 crore.

Cost Management Efforts Yield Results

On the expenditure side, subcontracting costs and rent & maintenance cumulatively accounted for 31.6% of the total spending, which was recorded at Rs 207 crore (Q1-Q3) FY24. Employee benefits, brokerage fees, electricity costs, legal fees, depreciation & amortization, financing charges, and other overheads pushed the total expenditure to Rs 653 crore during the same period.

Despite incurring losses, Awfis managed to reduce its net losses to Rs 19 crore in the first nine months of FY24 due to its expanding business scale and controlled cost mechanisms. In simpler terms, the company spent Rs 1.06 to earn every rupee during the aforementioned period.

Awfis IPO Details and Upcoming Listings

Awfis will be accepting public bids from May 22nd to 27th with a price range of Rs 364-382 per share. The minimum investment amount will be determined by a lot size of 39 shares. The details regarding shares offered to anchor investors will be disclosed on May 21st, 2024.

The current IPO activity reflects a trend with several startups filing draft IPO documents in the past six months, seeking SEBI approval. Notable names include Ola Electric, FirstCry, MobiKwik, and Unicommerce.