WeWork India’s ₹3,000 Crore IPO Opens: Should You Invest?

WeWork India has launched its initial public offering (IPO) with a target of ₹3,000 crore, opening for subscription on October 3, 2023. This offering is a pure Offer For Sale (OFS), meaning that the proceeds will not benefit the company directly. Instead, shares will be sold by its promoter, Embassy Buildcon LLP, along with Ariel Way Tenant Ltd., a subsidiary of WeWork International.

Founded in 2017, WeWork India operates as a flexible workspace provider, currently managing 68 operational centres across the country. The company boasts a capacity of approximately 114,000 desks across eight major cities, with Bengaluru and Mumbai accounting for nearly 70% of its overall capacity. Bengaluru alone represents 46.1% of this capacity, while Mumbai contributes 23.93%.

In its latest financial report for the first quarter of the fiscal year 2026, WeWork India recorded a revenue increase of 19.3% year-on-year, reaching ₹535.3 crore. The company’s net loss also narrowed to ₹14.1 crore, down from ₹29.1 crore the previous year. Additionally, its adjusted EBITDA margin decreased to 18% from 21.7%.

IPO Subscription Details

The IPO will remain open for three days, closing on October 7, 2023. Retail investors can participate by bidding for a minimum of one lot, consisting of 23 shares, amounting to an initial investment of ₹14,904. Subsequent bids can be made in multiples of 23 shares. The allotment of shares will be determined on October 8, with shares expected to debut on the National Stock Exchange and Bombay Stock Exchange on October 10.

Investment Opinions and Market Sentiment

Investment firms have varied perspectives on the IPO. Angel One has adopted a neutral stance, noting that at the upper end of the price band, the company’s post-issue price-to-earnings (P/E) ratio stands at 67.7 times, indicating a premium valuation. They emphasize that while WeWork India operates in a growing sector, factors like high fixed costs and market risks contribute to uncertain returns.

Conversely, SBI Securities acknowledges the advantages of WeWork India’s affiliation with its global parent. They assign a neutral rating as the company is valued at a P/E multiple of 50.1 times for the financial year 2025 based on the post-issue capital, suggesting fair valuation. They advise monitoring the performance following the listing before making further investment decisions.

On a more positive note, Canara Bank Securities recommends subscribing to the IPO, highlighting the company’s strong brand recognition, market leadership, and beneficial relationship with its global parent. Nonetheless, they caution against geographic concentration risks and ongoing legal proceedings involving the promoters, including show cause notices issued by the Securities and Exchange Board of India (SEBI).

Current reports from the unlisted market indicate a grey market premium (GMP) of ₹15 per share for WeWork India. It is essential for potential investors to recognize that these figures are speculative and the actual listing price may differ significantly from the GMP.

As WeWork India prepares for this significant milestone, investors must weigh the potential benefits against the inherent risks associated with the company and the broader market dynamics.