Smartworks Coworking Spaces Limited has expanded its physical footprint by adding approximately 1,41,124 Sq. Ft of capacity in Aerocity, Delhi NCR. The disclosure, made on August 4, 2026, under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, highlights the company’s push to meet growing demand for flexible office spaces. This expansion is significant for investors as it reinforces the company’s market position in a high-demand corridor, supported by robust existing occupancy metrics.

The capacity addition falls within the timeline of August or September 2026. Smartworks plans to fund this expansion with an investment of up to ₹25 crore (Approx.), utilizing a mix of internal accruals, issue proceeds, and external debt. The move aligns with the company’s strategy to support business growth and expand its operational footprint, as stated in the filing submitted to both the National Stock Exchange of India Limited and BSE Limited.

Expansion Details

The following table outlines the key parameters of the capacity addition as per Annexure A of the regulatory filing:

Existing Footprint and Utilization

As of June 30, 2026, Smartworks reported a total leased capacity of 14.5 Million Sq. Ft., which includes operational, fitout, and yet-to-be-handover spaces. Of this total, the operational capacity stood at 10.4 Million Sq. Ft. The company maintains a healthy utilization rate, with 81% of its operational capacity currently utilized. Furthermore, the committed occupancy for operational capacity is recorded at 86%, indicating strong tenant retention and forward-looking demand visibility.

What the Numbers Show

The combination of high committed occupancy (86%) and active capacity expansion suggests that Smartworks is scaling ahead of immediate demand rather than reacting to it. With nearly nine out of ten operational square feet already committed, the addition of ~1.41 lakh Sq. Ft in a premium location like Aerocity indicates confidence in sustained corporate demand for coworking solutions. The reliance on internal accruals alongside external debt for the ₹25 crore investment reflects a balanced approach to capital allocation, preserving liquidity while pursuing aggressive geographic consolidation in key business hubs.

Smartworks Coworking Spaces Limited reported robust financial results for Q1 FY27, with revenue from operations rising 44% year-on-year to ₹5,462 million. The company’s normalised profit after tax (PAT) nearly tripled to ₹388 million, while normalised EBITDA surged 74% to ₹1,069 million, driven by operating leverage and margin expansion to 19.6%. During the subsequent earnings call held on July 22, 2026, management reaffirmed its full-year revenue growth guidance of 28% to 30% and outlined a significant capital expenditure cycle for FY27.

Financial Performance

The company’s total income for the quarter stood at ₹5,596.66 million on a consolidated basis, against total expenses of ₹5,420.98 million. Profit before tax was ₹175.68 million, marking a turnaround from the loss before tax of ₹55.69 million in Q1 FY26. On a standalone basis, total income reached ₹5,414.34 million with a profit before tax of ₹137.32 million. EBITDA for the quarter was ₹3,460 million, up from ₹2,410 million in the same period last year.

Consolidated Financial Results (₹ in millions)

Operational Highlights

Smartworks’ operational portfolio expanded to 10.4 million sq. ft. across 54 centres in 15 cities, including Singapore. Committed occupancy at mature centres stood at approximately 92%, with overall mature centre occupancy at 89%. The company added ~5.0 million sq. ft. since its IPO, bringing total signed business area to 16.9 million sq. ft. Contracted rental revenue is approximately ₹54,000 million, covering 87.2% of the full-year guidance.

Strategic Developments and Capex Guidance

Subsequent to the quarter end, Smartworks acquired 100% equity shares of Workstudio Spaces Pte. Ltd., a Singapore-based operator, for SGD 2.47 million (₹182.20 million). This acquisition adds over 1,500 seats in Singapore, which currently contributes about 2% of total revenue. Management clarified that international growth will be self-funded through international cash flows, while India cash flows will support domestic expansion.

For FY27, management guided for a capital expenditure outlay between ₹550 crore and ₹600 crore. This includes both new fit-outs and refurbishments. New fit-out costs are estimated at ₹1,350 per sq. ft., increasing by 5% annually due to inflation, while refurbishment capex is approximately 15% of initial capex every three years. The company has secured long-term rights to properties in prime locations, ensuring supply visibility through FY29.

What the Numbers Show

The surge in value-added services (VAS) revenue highlights a diversification beyond core rentals. Non-lease rental revenue tripled from ₹22 crore in Q1 FY26 to ₹68 crore in Q1 FY27, driven by recurring services like food programs. Additionally, the client mix is shifting towards larger enterprises; the 1,000+ seat cohort now contributes 41% of revenue, up from 37% in FY26, while GCC clients account for 21% of revenue, up from 15%. This shift supports higher annuity-like revenue stability and margin accretion.