Earnings Call Overview
• Date: June 20, 2024
• Transcript submitted on June 26, 2024
• Directed to National Stock Exchange of India and BSE Limited
• Key personnel: Chairman Amit Ramani and executives
• Focus on forward-looking statements and company performance
Company Background
• Founded in 2015, leading provider of flexible workplace solutions in India
• Operates 181 centers across 17 cities
• Capital-light Managed Aggregation model comprises 64% of centers
• Recent IPO raised INR 599 crores for expansion and working capital
Awards and Industry Outlook
• Received multiple awards in 2024, including Best Co-Working Brand
• Anticipated growth in co-working industry due to MNC investments and corporate expansion
• Future strategies:
• Capital-efficient managed aggregation model
• Expansion into Tier 2 cities
• Enhanced product and service offerings
• Improved operational efficiency
Financial Performance
• FY24 revenue: INR 849 crores (56% YoY growth)
• Q4 revenue: INR 232 crores (46% increase)
• Revenue breakdown: 73% co-working, 24% construction, 3% other services
• Occupancy levels: 71%, with new centers achieving 80% occupancy quickly
• Plans to add 40,000 seats in FY25, targeting 135,000 total seats
Q&A Highlights
• Managed Aggregation model aims for 65-68% split with Straight Lease
• Growth opportunities in Tier 2 cities, with demand mirroring larger markets
• Cash EBITDA for FY24 confirmed at INR 97 crores (168% YoY growth)
• Focus on smaller cohorts for risk reduction and sustainability
• Anticipated EBITDA margin improvement of 150 basis points in FY25
Market Position and Strategy
• Projected growth of commercial real estate sector to 16% by 2026
• Unique position as largest player with plans for over 40 new centers
• Emphasis on a comprehensive platform approach for diverse customer segments
• Low reliance on brokers (40%) with strong in-house sales engine
Operational Insights
• Ideal EBITDA margins: 30-35% for straight-lease centers, 23-25% for managed aggregation
• Mature centers expected to improve margins as overheads decrease
• In-house design and project management teams enhance efficiency
Conclusion
• Overall positive outlook on growth trajectory and competitive differentiation in the market.