The initial public offering (IPO) of Awfis Space Solutions continued to see a strong response from the investors during the last day of the bidding process as the qualified and non-institutional investors joined the party. The issue was booked more than 11 times on the third day of the bidding process.
Awfis Space Solutions is selling its shares in the price band of Rs 364-383 apiece. Investors can apply for a minimum of 39 shares and its multiples thereafter. The Rs 598.93 crore FPO issue includes a fresh share sale of Rs 128 crore and an offer-for-sale (OFS) of up to 1,22,95,699 equity shares by its promoters and other shareholders.
According to the data, the investors made bids for 58,39,49,028 equity shares, or 67.67 times, compared to the 86,29,670 equity shares offered for the subscription by 14.30 hours IST on Monday, May 27. Bidding for the issue of Awfis Space Solutions, which had opened on Wednesday, May 22, closes today.
The allocation for retail investors was subscribed 44.26 times, while the portion reserved for non-institutional investors saw a subscription of 102.85 times. Allocation for qualified-institutional bidders (QIBs) was booked 58.46 times. However, the portion set aside for employees attracted bids for 20.42 times as of the same time.
New Delhi-based Awfis Space Solutions, incorporated in December 2014, is a workspace solution provider in India. The company offers a wide range of flexible workspace solutions, catering to the needs of individuals, start-ups, SMEs, and large corporations. It has expanded its business offerings and now provides in-house fit-out and facility management services at its centers.
The grey market premium (GMP) for Awfis Space Solutions has seen a decent improvement after strong bidding and buying in the broader markets. The company was commanding a GMP of Rs 120 apiece, suggesting a listing pop of 31 per cent to the investors from the upper end of the price band. The premium in the unofficial market stood at Rs 110-115 on Friday.
Brokerage firms are mostly positive on the issue. They are suggesting to subscribe to the issue citing its strong leadership, growth potential in the market, robust supply and cost efficiency. However, some analysts are concerned over its loss-making nature, increasing competition, market fluctuations and issues in retaining clients.
Despite challenges, management is confident that Awfis can turn net cash positive by the next fiscal year. They anticipate bright prospects ahead, driven by the significant demand and supply gap in the flexible workspace segment in which Awfis operates. This optimistic outlook and strategic initiatives and market positioning, suggests a strong potential for the future, said Mehta Equities.
"While due to its unique business model and first of its kind getting into listing space and early mover advantage, the company may command some listing gains. Investors should also understand the offer which comes with higher OFS which is an area of concern for new investors. Hence considering all parameters, we recommend only risk-taking investors to 'subscribe' to the issue," he said.
The company has reserved shares worth Rs 2 crore for its eligible employees, who will get a discount of Rs 36 apiece. Of the net issue, 75 per cent shares are reserved for qualified institutional bidders (QIBs), while non-institutional investors (NIIs) will get 15 per cent allocations. Remaining 10 per cent shares shall go to the retail investors of the issue.
Awfis is poised for substantial growth, driven by the growing demand for flexible workspaces in India. Through modern design innovations, technology integration, and expanded facility management services, the company is focused on providing comprehensive and advanced workspace solutions to cater to a wide range of clients, said Arihant Capital Markets.
On a post-issue basis, the company trades 9.53 times P/B and 3.23 times P/S on a 9MFY24 sales annualized basis. The industry dynamics seem positive with increasing demand for commercial real estate in Tier-I and Tier-II cities., it added with a 'subscribe' for long-term rating on the issue.
Awfis Space Solutions mobilised a little over Rs 268.61 crore from anchor investors as it allotted 70.13 lakh equity shares to 32 funds at Rs 383 apiece. Awfis Space Solutions reported a net loss of 18.94 crore with a revenue of Rs 633.69 crore for the nine months ended on December 31, 2023. Its net loss came in at Rs 46.64 crore with a revenue of Rs 565.79 crore for FY23.
Axis Capital, IIFL Securities, ICICI Securities and Emkay Global Financial Services are the book running lead managers of the Awfis Space Solutions IPO, while Bigshare Services is the registrar for the issue. Shares of the company shall be listed on both BSE and NSE likely on Thursday, May 30.