Smartworks IPO listing: Shares debut at 7% premium over issue price

Smartworks Coworking Spaces made a positive debut on the domestic bourses on Thursday, with its shares listing at a 7% premium over the initial public offering (IPO) price. On the National Stock Exchange (NSE), the stock opened at ₹435, up 6.88% against the issue price of ₹407 per share. On the BSE, Smartworks shares debuted at ₹436.10, marking a 7.15% gain over the IPO price. The market capitalisation of the company increased by around ₹70 crore to ₹4,977.27 crore.

Meanwhile, the BSE Sensex was trading 68 points lower at 82,566, and the NSE Nifty was down 25 points at 25,187.

The listing was broadly in line with Street expectations as the stock was trading at a premium of ₹25 in the grey market, indicating a listing price to be around ₹432, up 6.14% over the issue price.

The ₹582 crore IPO of Smartworks, comprising a fresh issue of equity shares worth ₹445 crore and an offer for sale (OFS) of ₹137 crore by the promoters, was subscribed 13.92 times overall. The IPO, which opened for subscription from July 10 to 14, saw robust demand from institutional investors. The portion reserved for qualified institutional buyers (QIBs) was subscribed 24.92 times, while the non-institutional investor (NII) segment saw a subscription of 23.68 times. The retail investor category was subscribed 3.69 times.

The lot size for retail investors was 36 shares, requiring a minimum investment of ₹14,652 for one lot. The company had reserved 50% for the IPO for QIBs, 15% for NIIs, and the remaining 35% for retail investors.

A day ahead of the opening of the IPO, Smartworks raised ₹173.64 crore from anchor investors by allocating a total of 42.66 lakh equity shares at ₹407 per share with a lot size of ₹10 apiece. Of the total 42.66 lakh shares allocated to anchor investors, 32.04% were subscribed by three domestic mutual funds through a combined total of four schemes. The participating mutual funds include Tata Mutual Fund, Baroda BNP Paribas Mutual Fund, and Trust Mutual Fund.

Smartworks, co-founded by Neetish Sarda and Harsh Binani, proposes to utilise the net proceeds from fresh equity issuance for repayment of certain borrowings availed by the company; meet capital expenditure for fit-outs in the new centres; and for security deposits of the new centres to be deployed in the coming years. The balance amount will be used for general corporate purposes.

The office experience and managed campus platform will use ₹226 crore for capital expenditure, ₹114 crore for repayment of loans, and the remaining funds for general corporate purposes.

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