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    Indiqube Spaces Limited

    INDIQUBE
    Services·10 Nov 2025
    Management Summary

    IndiQube Spaces Limited reported strong Q2 FY26 results with significant year-on-year growth in revenue and EBITDA, driven by healthy occupancy levels and increased contribution from value-added services. The company achieved an 8% PAT margin and more than doubled its operating cash flow. Management outlined strategies for continued expansion in Tier 1 and Tier 2 cities, focusing on build-to-suit and renovated properties, while maintaining a strong client retention rate and targeting free cash flow positivity by FY27.

    Highlights

    5

    • Revenue for Q2 FY26 stood at INR354 crores, representing a 38% year-on-year growth.

    • EBITDA for Q2 FY26 was INR75 crores, which is up 74% year-on-year.

    • PAT margins improved significantly to 8% in Q2 FY26, compared to 3% in the same period last year.

    • Cash flow from operations more than doubled to INR151 crores in Q2 FY26, compared to INR64 crores in the same period last year.

    • Occupancy level reached 87% in Q2 FY26, up from 81% in the previous quarter, reflecting robust demand and client stickiness.

    What Changed2

    vs Q3 FY26

    Guidance items8 → 11 (+3)Risks discussed3 → 1 (-2)

    Key financials

    Single quarter

    08 metrics
    1. 01Revenue₹354 Cr+38%YoY
    2. 02EBITDA₹75 Cr+74%YoY
    3. 03PAT Margin8%
    4. 04EBITDA Margin21%
    5. 05Cash Flow from Operations₹151 Cr

    Capital allocation

    1
    medium confidence
    CategoryHeadline
    Capex

    ₹350 crores

    Guidance & targets

    11
    CategoryTargetPriority
    Revenue
    Top line growth
    30%
    		High
    Operational Area
    Rent-paying area
    7.6-7.67 million square feet
    		High
    Occupancy
    Occupancy level
    85% plus or minus a couple of percentage points
    		High
    Profitability
    EBITDA Margin
    20% to 21%
    		High
    Value Added Services
    VAS contribution to revenue
    at least 15%
    		High
    Cash Flow
    Free cash flow status
    breakeven or slightly positive
    		High
    Growth Rate
    Self-sustainable growth rate
    30%-35% (plus or minus 2%-3%)
    		High
    Flex Office Space Stock
    Total stock in country
    140 million square feet
    		High
    Flex Office Space Stock
    Annual addition to stock
    20 million annually
    		High
    Area Under Management
    Additional AUM
    1.3 to 1.5 million square feet
    		High
    Design & Build
    Pipeline for design and build
    1.5 lakh to 2 lakh square feet
    		High

    What to watch in Q3 FY26

    5

    Rent-paying area conversion progress

    By March '26
    Current5.8 million sq ft (Q2 FY26)
    TargetProgress towards 7.6-7.67 million sq ft

    Why it matters

    This indicates the rate at which signed area is converted into revenue-generating operational space, directly impacting future top-line growth.

    my rent-paying area... will be around about 7.6 million, 7.67 million square feet. That would be my rent-paying area by March '26.

    Risks & concerns

    1
    RiskSeverity

    Impact of AI on office space demand

    Management views AI as accelerating the adoption of flexible workspaces due to increased corporate demand for agility and flexibility, rather than posing a risk. — Management acknowledged

    low

    Q&A highlights

    8

    “So this design and build project comes under the bespoke model. And so the landlord deal was done by them. But the client really liked our platform and the way we have designed and managed the entire enterprise. So they signed up with us in the bespoke model... we have very healthy margins, which are actually in line with EBITDA margins.”

    Clarifies the nature of a significant new project and confirms its profitability aligns with existing offerings, addressing investor concerns about new business models.

    asked by Adhidev

    3 min read7 chapters

    Detailed Narrative

    01

    Strong Financial Performance in Q2 FY26

    IndiQube reported a robust Q2 FY26 with revenue reaching INR354 crores, marking a 38% year-on-year growth. EBITDA surged by 74% YoY to INR75 crores, leading to an improved PAT margin of 8% compared to 3% in the prior year. Operating cash flow more than doubled to INR151 crores, significantly exceeding EBITDA, highlighting operational efficiency and healthy profitability.

    02

    Expanding Portfolio and Robust Occupancy

    The company's total signed portfolio stands at 9.14 million square feet across 125 centers and 16 cities, with 5.8 million square feet currently rent-yielding. Management expects the entire 9.14 million square feet to become rent-paying within 18 to 24 months, projecting a rent-paying area of 7.6-7.67 million square feet by March '26. Occupancy levels remained strong at 87% in Q2 FY26, up from 81% in Q1 FY26, with a low monthly churn of 0.01%, reflecting strong client retention.

    03

    Value-Added Services (VAS) as a Key Growth Driver

    Value-added services (VAS) contributed 13% to total revenue in Q2 FY26, an increase from 11% in the previous year, reflecting strong client adoption and engagement. IndiQube plans to expand its B2B and B2C service spectrum to include facilities, F&B, IT, mobility, and solar services, targeting a VAS contribution of at least 15% in the next financial year. This strategy aims to integrate VAS further into the overall workspace experience and enhance revenue quality.

    04

    Strategic Geographic Expansion and Supply Sourcing

    IndiQube continues its 'follow the talent' strategy, expanding in Tier 1 cities like Mumbai (from 85,000 to 140,000 sq ft) and Tier 2 cities, having added Indore and planning 3-4 more city additions in H2. The company's supply sourcing strategy for future growth includes build-to-suit properties (15-20% cheaper), acquiring and renovating older 'brownfield' assets (e.g., Bangalore MG Road at INR130-140/sq ft vs INR300/sq ft for new), and reactive client-driven acquisitions.

    05

    Innovation and Sustainability Initiatives

    The company introduced AI routing for transport management and a cafeteria crowd meter module to enhance operational efficiency and employee experience. IndiQube is also expanding its solar energy capabilities, building on its existing 20-megawatt solar farm in Yadgir and 22 rooftop installations, with plans to scale the farm to 70 megawatts. These initiatives reinforce its ESG credentials and contribute to power bill savings, impacting margins positively.

    06

    Competitive Landscape and Moats

    IndiQube highlights its competitive advantages, including its large operator status, pan-India presence, and strong referenceability network, with 40% of clients occupying multiple centers. The company notes that 65% of its total occupancy comes from clients with over 300 seats, reflecting a focus on large enterprise clients, comprising 40% GCCs and 60% Indian enterprises. Management believes the market will gravitate towards a few large players due to network effects and service quality.

    07

    Capital Expenditure and Free Cash Flow Outlook

    Capex for H1 FY26 stood at INR179 crores, with an estimated full-year FY26 capex of INR350-360 crores, and a similar range expected for FY27. This capex includes advances for future projects and renovation. Management anticipates the company to be free cash flow positive or slightly positive in FY27, driven by improving operating cash flows and the gradual conversion of signed AUM into rent-yielding assets.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.