Smartworks Coworking Spaces Reports Strong Q1 FY27 Performance with Net Profit of Rs. 131.48 Million Driven by Revenue Surge

Smartworks Coworking Spaces Limited has released its unaudited consolidated financial results for the first quarter ended June 30, 2026. The major flexible workspace provider demonstrated sustained momentum across key metrics, achieving substantial top-line expansion and maintaining profitability compared to a net loss reported in the corresponding period of the previous fiscal year.

Top-Line Revenue and Total Income Expansion

The company reported a significant jump in scale during Q1 FY27, backed by rising demand for managed office spaces:

Revenue from Operations: Smartworks generated revenue from operations of Rs. 5,462.48 million for the quarter ended June 30, 2026. This marks a 44.05% growth compared to Rs. 3,792.11 million recorded in Q1 FY26 (quarter ended June 30, 2025), and a sequential gain of 5.11% over Rs. 5,196.83 million in Q4 FY26 (quarter ended March 31, 2026).

Other Income: Other income for the quarter stood at Rs. 134.18 million, up from Rs. 87.76 million in Q1 FY26 and Rs. 130.21 million in Q4 FY26.

Total Income: Driven by core operational growth, total income reached Rs. 5,596.66 million for the period under review, expanding 44.40% year-on-year from Rs. 3,875.87 million in Q1 FY26 and rising from Rs. 5,327.04 million recorded in the preceding quarter.

Expenditure Breakdown

Total expenses for the quarter ended June 30, 2026, totaled Rs. 5,420.98 million, up from Rs. 3,935.56 million in Q1 FY26 and Rs. 5,104.55 million in Q4 FY26. The major cost drivers for the period included:

Operating Expenses: Represented the largest operational outlay at Rs. 1,542.72 million, compared to Rs. 1,035.40 million in Q1 FY26 and Rs. 1,390.06 million in Q4 FY26.

Depreciation and Amortisation Expense: Stood at Rs. 2,457.08 million, reflecting workspace portfolio expansion relative to Rs. 1,739.12 million reported in Q1 FY26.

Finance Costs: Accounted for Rs. 960.98 million during the quarter, compared to Rs. 814.57 million in Q1 FY26 and Rs. 950.57 million in Q4 FY26.

Employee Benefits Expense: Rose slightly to Rs. 264.19 million, against Rs. 233.54 million in Q1 FY26 and Rs. 238.83 million in Q4 FY26.

Other Expenses and Purchases: Purchases of stock-in-trade were recorded at Rs. 58.44 million, while other expenses stood at Rs. 137.57 million for the quarter.

Profitability and Earnings Per Share

Smartworks posted a clear financial turnaround year-on-year, sustaining positive bottom-line results for two consecutive quarters:

Profit Before Tax (PBT): The company achieved a profit before tax of Rs. 175.68 million for Q1 FY27, reversing a loss before tax of Rs. 59.69 million recorded in Q1 FY26. On a sequential basis, PBT stood lower than Rs. 222.49 million reported in Q4 FY26.

Tax Expenses: Total tax expenses for the quarter came in at Rs. 44.20 million (comprising current tax of Rs. 115.95 million offset by a deferred tax credit of Rs. 71.75 million).

Net Profit: Profit for the period reached Rs. 131.48 million, compared to a net loss of Rs. 41.97 million in Q1 FY26 and a net profit of Rs. 166.24 million in Q4 FY26.

Total Comprehensive Income: Total comprehensive income for the quarter ended June 30, 2026, stood at Rs. 131.80 million (inclusive of foreign currency translation and defined benefit re-measurements), compared to a total comprehensive loss of Rs. 30.33 million in Q1 FY26.

Earnings Per Share (EPS): Basic and diluted EPS (not annualised) were both reported at Rs. 1.15 per equity share of face value Rs. 10 each for Q1 FY27, up from a negative EPS of Rs. (0.41) in Q1 FY26.

Capital Base

As of June 30, 2026, Smartworks Coworking Spaces Limited maintained a paid-up equity share capital of Rs. 1,142.63 million (consisting of shares with a face value of Rs. 10 each), remaining consistent with the paid-up capital position reported as of March 31, 2026.

Commenting on the performance, Mr. Neetish Sarda, Founder & Managing Director, Smartworks, said: "When we listed Smartworks a year ago, we were confident that India's flex space market had entered a long-term growth phase. We believed large enterprises would increasingly move away from traditional offices in favour of flexible, fully managed workspaces that could scale with their business. One year later, that conviction is reflected not just in our financial performance, but in the way our clients are choosing to grow with us.

Our ability to design and deliver workspaces customised to each client's needs - whether functional, premium or anywhere in between - continues to differentiate Smartworks. We are continuously enhancing our members' experience and the way we deliver our services by integrating AI into our internal tools and processes, enabling faster execution, better decision-making and more efficient operations.

Today, clients with over 1,000 seats contribute ~41% of our rental revenue, up from ~37% for FY26, while revenue from multi-city clients has increased to ~35% from ~31% for FY26. These are strong indicators that large enterprises continue to choose and expand with Smartworks. The hardest thing in this business is finding great buildings and we have already found our next two years' worth. By strategically leasing properties in prime locations well in advance, we are well positioned to meet our clients' growth requirements in cities where only a limited number of large, high-quality managed campuses are available.

With ~₹5,400 crore of contracted rental revenue and our expansion pipeline already secured through FY28 and partially for FY29, we remain confident of delivering our guidance and creating long-term value."

Outlook FY27

Smartworks reiterates its FY27 guidance of 28-30% revenue growth, 19-20% normalised EBITDA margin, and an operational footprint of 12.5-13 million sq. ft. by March 2027.

India's office market recorded its highest-ever quarterly leasing of ~24.6 million sq. ft. in April-June 2026, with managed workspace operators accounting for 27% of total leasing - the largest single category. Global companies setting up India offices anchored 42% of total absorption, according to a leading property consultant. In a market running short of quality office space, getting the right buildings first is the biggest advantage - and Smartworks widened that lead this quarter.

Shares of Smartworks Coworking Spaces Limited was last trading in BSE at Rs. 499.35 as compared to the previous close of Rs. 485.20. The total number of shares traded during the day was 5801 in over 341 trades.

The stock hit an intraday high of Rs. 511.40 and intraday low of 485.95. The net turnover during the day was Rs. 2896884.00.

Source : Equity Bulls

Keywords

SmartworksCoworkingSpaces INE0NAZ01010 Q1FY27 Q1FY2027 ResultUpdate