WeWork India Management Limited — Q1 FY27 earnings call

So, this will now from this year onwards actually smoothen out any type of lumpiness that we basically saw last year, and you'll have a more recurring base of customization revenue as the quarter's kind of flow through. So typically, in the range of between INR10 crores to INR15 crores in a quarter is what we kind of expect will be run rate when you look at this customization kind of revenue. ... Margins are holding as expected, and if you look at the growth center occupancy, it's already well above break-even. So, all the buildings are actually delivering profitability.

Clarifies the new accounting treatment for customization revenue to reduce lumpiness and confirms profitability of new centers from the outset.

Asked by Adhidev Chattopadhyay

Now in terms of the capex cycle, we hold good on the guidance of between INR500 crores to INR600 crores, and that is the visibility that we have today.

Reaffirms the company's capex plans for the current fiscal year, indicating continued investment in growth.

Asked by Adhidev Chattopadhyay

So typically, it's actually like a full flow-through. The cost that we have is similar to our other - the rest of our business or normal business, which is essentially just the fit-out cost that we kind of put through into the space. So, this is all revenue that basically flows directly to the bottom line, and it always has been.

Highlights the high-margin nature of customization revenue, contributing directly to the bottom line without significant associated costs.

Asked by Abhinav Sinha

We don't foresee the margin dipping; we actually see potentially the margin moving upwards because of the large managed offices that are a component of that expansion coming up in Q2. ... So, a lot of the seat additions in this quarter was largely WeWork branded speculative seat additions. A larger portion of next quarter's additions are actually managed office, so there's already some demand back which, you know, these centres will be opening at basically higher occupancies than, you know, than we did in this quarter.

Provides confidence that margins will not dip in Q2 despite new center openings, attributing it to higher occupancy in managed office additions.

Asked by Abhinav Sinha

Sorry, yes. The INR3,363 crores are current average commitment over the portfolio average which you're right is about 27 months. As you can see, that's growing -- basically has grown almost like 60% year-over-year, and on a sequential basis also is sort of growing almost like 15%.

Clarifies the nature and growth of the contracted revenue, providing visibility into future earnings.

Asked by Siddhant Mayecha

So, 10.3 won't move meaningfully between now and the end of the year. Even for next year, we already have identified our pipeline. We're in the process of basically signing LOIs and leases which over the next quarter we'll see more we'll probably show you more of a solid amount for FY28. ... A lot of the AUM that you're seeing even beyond March of 2027 are deals that we signed for FY28, FY29.

Outlines the long-term capacity expansion plans, indicating strong future growth visibility beyond the current fiscal year.

Asked by Yashas Gilganchi

So, when we reduced INR4,000 crores to about INR3,000 crores, what happened was a stub of the debt that we would have loved to have paid off, you know, remained, which was about INR570-odd crores, you know, which continues to be what is pledged against the shares. ... maybe around 30 lakh shares will get released in the coming quarter. ... Our endeavor is 100% to try to, you know, get this removed or pay off the debt within this financial year

Explains the reason for the promoter pledge and provides a clear timeline and commitment for its reduction and eventual removal, addressing a key investor concern.

Asked by Ankit Minocha

So, I think, you know, fundamentally what we're seeing in the market is customers opting for an operator not because they are looking at space just in a single asset or a single location; they want a partner that can help them basically through their entirety of their growth. ... a lot of REITs don't want to get into basically managing the FM part... It's a high service level, high experience level ask that a lot of these customers are asking for internally itself, right? And we are able to do that because we specialize in that... with REITs, you have to give a longer commitment. You know, they're not willing to do deals at three years or five years; they want you to give a nine-year commitment... However, we are able to, you know, offer more flexibility

Differentiates WeWork's offering from REITs, highlighting its integrated service model, flexibility, and ability to manage complex client requirements as competitive advantages.

Asked by Sukhman Arora