AWFIS Space

Awfis Space Solutions reported a robust Q3 FY26, with consolidated operating revenues growing 20% year-on-year to ₹382 crores. Operating EBITDA saw an even stronger increase of 30% year-on-year, reaching ₹139 crores, and EBITDA margins expanded by 270 basis points to 36.5%. For the nine months of FY26, operating revenues were ₹1,083 crores (up 25% YoY) and operating EBITDA was ₹398 crores (up 39% YoY), with margins at 36.7%. PAT, excluding exceptional item^📎s, stood at ₹22 crores for the quarter, compared to ₹15 crores in the prior year period.

The company's total operational seats reached 152,000 across 232 centers Pan-India as of December 2025, reflecting a 25% year-on-year growth in operational seats. Including centers in the fit-out phase and under LOI, total capacity stands at 177,000 seats across 257 centers, covering 8.6 million square feet. Awfis added over 8,000 new seats during the quarter. The FY26 seat addition guidance has been revised to 32,000-33,000 seats from an initial 40,000, with an expectation to reach approximately 166,000 operational seats by March 2026.

The co-working and allied services segment continues to be the primary growth driver, with revenue increasing 32% year-on-year to ₹322 crores in Q3 FY26. This segment contributed 84% of the total revenue. The growth was supported by high occupancy levels across an expanded seat base and strong traction from Global Capability Centers (GCCs) and enterprise clients. Management noted that pricing escalations of 5-7% for small-to-mid cohorts and 4-5% for larger cohorts are built into existing contracts, ensuring consistent revenue growth.

The Awfis Transform (construction fit-out) segment contributed ₹60 crores during the quarter, experiencing a revenue decline. This was primarily attributed to temporary project deferrals and execution delays due to GRAP-IV pollution norms, as well as lower managed aggregation seat additions compared to the previous year. Despite the Q3 impact, the company maintains a strong pipeline for Awfis Transform, with third-party projects spanning 9 lakh square feet (₹200 crores revenue opportunity) and managed aggregation covering 4 lakh square feet. The segment is expected to recover and stabilize its revenue contribution to an 80-20 split with co-working in the future.

Overall occupancy improved to 75% from 73% last year. Centers older than 12 months are operating at 84% occupancy, and management expects this to improve by 100-150 basis points in the next one to two quarters. The average client tenure has increased to 37 months, with an average lock-in period of 26 months. Multi-center clients account for 46% of occupied seats, with over 300 clients having an average tenure of 42 months. The client base remains highly diversified, serving over 3,400 active clients.

Awfis continues to strengthen its Pan-India presence with 257 centers across 18 cities. The company has 80+ GCCs in its ecosystem, contributing 21% to space revenue. The strategy involves focusing on Grade-A buildings and premium locations, with 100% of new supply in Grade-A and A-minus assets. The Tier-2 seat capacity grew by 16% year-on-year, indicating broader adoption of flexible workplace models. The company is strategic in selecting customers for large dedicated centers to mitigate risks associated with customization and post-lock-in occupancy.

For the nine months of FY26, capital expenditure stood at ₹159 crores, with the full-year guidance maintained at ₹200-210 crores. The increase in depreciation and capex is linked to the focus on elite and MO seats, which often involve straight lease models and higher fit-out costs. The company's liquidity position remains strong, with a net debt-to-equity ratio of minus 0.06% as of December 31, 2025, and a cash balance (including investments) of ₹96 crores. Management noted that the tax holiday runway is expected to last for one more year.