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wework india It has its best operating year in terms of both profitability and revenue in 2022 and is expected to achieve a revenue of Rs 1500 crore in FY23. Karan Virwani CEO of WeWork India.
The firm reported a 250% increase in earnings before interest, tax, depreciation and amortization (EBIDTA) in 2022, registering a profit of Rs 175 crore, as against a loss of Rs 120 crore in the previous calendar year. WeWork generated revenue of Rs 1300 crore between January-December, as against Rs 760 crore in the previous calendar year.
“It has been a great year for us financially and the business is making enough profits to grow. We have seen growth not only in our managed office business, but also in the digital all-access business, which has registered a 6x growth in the year,” said Virwani.
WeWork India turns profitable at holding company level in Q1 2022, driven by strong demand over the past year
“The requirement to raise capital is very limited and we are looking at how we can grow our business both in terms of revenue and profitability as well as potential acquisitions,” Virwani said.
The Indian arm of the US-headquartered firm plans to expand its portfolio to 95,000 desks comprising over one million sq. flexible office space across the country by March 2024.
The company currently has 70,000 desks across 41 locations. WeWork leased 2.5 million sq ft in this calendar year, while 1.7 million sq ft of properties between January and December last year had 90 per cent occupancy.
US-based office space provider WeWork Global holds 27% stake in WeWork India, a subsidiary of the Bengaluru-based estate developer embassy group,
The two groups parted ways in 2017.
The demand for flexible space is expected to be driven largely by consulting, IT-BPM and e-commerce companies setting up multiple satellite offices in suburban locations in metro cities.
By the third quarter of 2021, approximately 88% of the total number of flexible workspaces were in metropolitan areas.
Since the launch of the US shared workspace provider in India, Embassy Group operates desks in the country’s top six markets, including Bengaluru, Gurgaon and Mumbai, totaling approximately 5.5 million sq ft of space.
According to property consulting firm Vestian, the flexible workspace market is growing sequentially in the country, with operational stock across seven major cities totaling around 45 million sqft by H1 2022. Bengaluru has accounted for the maximum penetration of flexible space stock and seat distribution among the cities. (H1 2022), with its share of the stock pegged at 35%.
“During the period 2015 to H1 2022, the co-working market grew nearly 6X in terms of stock added over the years, and this was fueled by rising demand arising from start-ups, SMEs and large corporates is,” said Srinivasa Rao, CEO, Vestian.
Vestian expects the share of flexible workspace to grow to more than 25% in 2025, while the total stock is expected to grow 1.5 times in 2025 compared to the total stock in 2022.
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