Smartworks Reports Q2 FY26 Revenue of INR 4,248 Mn, 12% QoQ Growth
Filing Summary
Smartworks Coworking Spaces Ltd disclosed its Q2 FY26 financial performance, reporting a revenue of INR 4,248 Mn, marking a 12% quarter-on-quarter increase. The company’s EBITDA stood at INR 696 Mn, reflecting a 46% year-on-year growth. The operational footprint expanded to 9.1 million square feet, with a committed occupancy rate of 93% for mature centers. The company continues to focus on enterprise clients, with 90% of revenue derived from this segment. Smartworks employs a straight lease business model, ensuring predictable cash flows and maintaining a strong balance sheet amid aggressive expansion.
Smartworks Coworking Spaces Ltd has released its financial results for Q2 FY26, reporting a revenue of INR 4,248 Mn. This represents a 12% increase from the previous quarter. The company’s EBITDA for the quarter was INR 696 Mn, showing a 46% growth year-on-year. The operational footprint expanded by approximately 0.8 million square feet, reaching a total of 9.1 million square feet. The committed occupancy rate for mature centers stands at 93%, indicating stable demand for the company’s managed office spaces.
The financial performance highlights include a normalized PBT of INR 245 Mn, which increased by 153% year-on-year. The company’s operating cash flow was reported at INR 614 Mn, although it saw a decrease of 29% quarter-on-quarter due to higher upfront security deposit outflows. The company’s annualized Return on Capital Employed (RoCE) improved to 14.3%, reflecting efficient capital utilization and operational efficiency.
Operationally, Smartworks continues to focus on providing tech-enabled, customized workspaces for enterprises. The company employs a straight lease business model, leasing properties on a long-term basis and transforming them into fully managed campuses. This model allows Smartworks to maintain control over fit-out, brand, and client experience, ensuring superior margin capture. The company’s technology platforms, including BuildX and Workctrl, facilitate rapid fit-outs and efficient operations, contributing to high occupancy rates and cash flow generation.
The company’s strategic timeline includes the addition of approximately 1.0 million square feet of operational space by March 2026, with a further 3.3 million square feet expected to become operational in FY27. This expansion is supported by the company’s ability to secure supply at preferred terms, leveraging relationships with both institutional and non-institutional developers.
Smartworks’ client base is predominantly enterprise-focused, with 90% of revenue derived from this segment. The company has a diversified demand base, with significant contributions from non-IT industries such as BFSI, consulting, and manufacturing. Global Capability Centres (GCCs) contribute over 15% of rental revenue, highlighting the company’s strong position in the managed workspace market.
The market context indicates that India’s managed workspace market is expanding at a rate 2.5 times faster than traditional coworking spaces. The shift from long-term leases to flexible, tech-enabled spaces is driving demand, with enterprises seeking to enhance productivity and reduce capital costs. Smartworks’ strategic focus on large campuses and enterprise clients positions it well within this growing market.
Smartworks Coworking Spaces Ltd is a leading provider of managed office spaces in India, focusing on delivering flexible, tech-enabled workspaces for enterprises. The company employs a straight lease business model, ensuring predictable cash flows and maintaining a strong balance sheet. Smartworks is committed to expanding its operational footprint while maintaining high occupancy rates and client satisfaction.