Smartworks raises FY27 revenue guidance to 35%; enterprise demand, large deal pipeline to drive growth, says MD Neetish Sarda

Smartworks Coworking Spaces has raised its FY27 revenue growth guidance to 33–35% from the earlier 28–30%, citing a strong pipeline of large deals and rising enterprise demand, said Neetish Sarda, Founder and Managing Director of the company.

“We were earlier guiding for revenue growth of 28–30%, but that number is now closer to 35%, driven by the significant increase in demand we are seeing from our customers as well as the uptake of our product,” Sarda told Fortune India.

The guidance upgrade follows a strong first-half performance, with the company witnessing expansion by existing clients across cities and new global businesses, Indian conglomerates and Global Capability Centres (GCCs) choosing its managed office platform.

Smartworks reported a 39% year-on-year (YoY) increase in revenue from operations to ₹591 crore in Q2 FY27. Normalised earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 68% to ₹117 crore, while normalised profit after tax more than doubled to ₹43.4 crore, registering a growth of 136%. EBITDA margin improved to 19.8% from 16.4% in the year-ago quarter.

For the first half of FY27, revenue from operations increased 41% YoY to ₹1,138 crore, while normalised EBITDA stood at ₹224 crore, with a margin of around 19.7%.

The company has retained its normalised EBITDA margin guidance of 19–20%, with margins expected to trend towards the upper end of the range. It also maintained its annual expansion target of adding 2.5–3 million sq. ft. of workspace.

Large deals, enterprise expansion drive demand

Sarda said the company was seeing demand across customer segments, with GCCs emerging as an important growth driver. GCCs currently contribute around 22% of Smartworks' rental revenue, compared with high single-digit levels about a year ago.

Enterprise clients account for approximately 91% of rental revenue. Clients occupying more than 1,000 seats now contribute around 41% of rental revenue, compared with 35% a year earlier. Multi-city clients account for 35%, up from 31% in Q2 FY26.

According to Sarda, the growing adoption of flexible workspaces reflects a structural change in how companies approach office infrastructure.

“Companies want to hire the right talent in the right location and scale up their operations quickly. Flexibility has become more mainstream because businesses increasingly want to focus on their core operations and partner with companies like us to manage their infrastructure requirements across cities,” he said.

Addressing concerns over artificial intelligence-led disruption and weakness in the IT sector, Sarda said the company's diversified client portfolio was helping offset the slowdown in certain segments.

“IT contributed around 50–60% of our business earlier, but that exposure has now come down to less than 40%. Our exposure to GCCs, BFSI, engineering and manufacturing clients is helping us de-risk the business. The growth from newer companies entering India and setting up their back-end operations is more than compensating for the slowdown in certain segments,” he said.

He added that several global companies entering India were committing to office requirements for four to five years, providing longer-term demand visibility.

₹600-crore capex planned for FY27

The company is in the middle of a significant expansion cycle, with plans to invest around ₹600 crore in capital expenditure during FY27. It has already deployed approximately ₹300 crore in the first half.

Sarda said the investments would start contributing to revenue and profitability over the coming quarters, given the time required to identify, develop and operationalise new properties.

“Capex does not translate into revenue immediately. There is always a lag because identifying a property and building it out takes around three to four months, after which we see the uptake and its contribution to the bottom line. The investments made in the first half will start reflecting in the numbers in the last quarter of this year and early next year,” he said.

Smartworks' total footprint stood at around 17.5 million sq. ft. across 71 centres, including signed and upcoming properties, as of September 30, 2026. Its operational footprint was approximately 10.9 million sq. ft., while contracted rental revenue stood at around ₹5,800 crore, providing visibility into future revenue.

The company is also preparing to operationalise two large campuses in the second half of FY27 — Eastside in Pune, spread across approximately 863,000 sq. ft., and Eastbridge in Mumbai, covering around 815,000 sq. ft. Both are expected to become operational largely towards the fourth quarter.

Smartworks' Singapore operations have expanded to four centres with around 1,600 seats. The company expects its expanding footprint, growing enterprise relationships and pipeline of large deals to support its next phase of growth.