WeWork India IPO: Marketing spend dips even as revenue surges ahead of Rs 3,000 crore share sale
WeWork India's advertising and sales promotion expenses accounted for 1.74% of total expenses in FY22, 2.40% in FY23, but slipped to 1.32% in FY24.
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WeWork India Management, which is set to launch its Rs 3,000 crore initial public offering (IPO) on October 3, has tightened its belt on advertising and sales promotion expenses even as overall costs and revenues grew sharply in recent years.
The company’s advertising and sales promotion expenses accounted for 1.74% of total expenses in FY22, 2.40% in FY23, but slipped to 1.32% in FY24. In absolute terms, consolidated ad spends stood at Rs 37.62 crore in FY23 and dropped to Rs 24.75 crore in FY24, with Rs 11 crore spent in the six months ended September 30, 2024.
Meanwhile, total expenses rose from Rs 14,796.65 million in FY22 to Rs 1,869.9 crore in FY24. Despite this, revenue from operations surged 67.58% to Rs 1,314.5 crore in FY23 and further 26.67% to Rs 1,665 crore in FY24. Adjusted EBITDA margin improved from -15.59% in FY22 to 20.40% in FY24, while the company narrowed its net loss to Rs 14 crore in the September 2024 quarter, against Rs 29.1 crore a year earlier.
Launched in 2017, WeWork India operates 59 centres with 94,440 desks and a 6.48 million sq. ft. leasable portfolio across eight key office markets including Bengaluru, Mumbai, Pune, Hyderabad, Gurgaon, Noida, Delhi and Chennai. According to CBRE, about 93% of its portfolio is in Grade A developments.
The IPO is an offer for sale (OFS) where promoter Embassy Buildcon LLP will sell 3.54 crore shares and investor Ariel Way Tenant Ltd (WeWork International) will offload 1.089 crore shares. Embassy currently holds 73.56% stake and WeWork International 22.64%. Proceeds from the IPO will go entirely to the selling shareholders.
CBRE report mentioned that the flexible workspaces to nearly double to 124–126 million sq. ft. across Tier-1 cities by 2027, growing at a CAGR of 18–19%.
