Buy Awfis Space Solutions; target of Rs 384: ICICI Securities

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • Awfis Space Solutions (Awfis) has delivered 20% YoY revenue growth in Q2FY27, driven by its focus on premiumizing its offerings and expanding its asset-light management agreements.
  • The company has restated its H1FY26 cash EBITDA calculations to reflect entire cash rental payments to landlords, leading to a revised IGAAP EBITDA margin of 10.8% in Q2FY27.
  • Awfis guides to close FY27 with ~170,000 operational seats and has a total signed supply of 188,000 seats as of Sep'26.
  • The company is targeting exit margins of ~12% by Mar'27 and expects to clock 12%+ margins going forward.

Thesis Validation Checklist

  • Investors should watch for stable revenue traction, EBITDA margin expansion, and the company's ability to achieve its target of ~12% exit margins by Mar'27.
  • Key risks include a slowdown in overall office leasing across India and pricing competition among co-working flexible workspace operators.
  • The company's focus on premiumizing its offerings and expanding its asset-light management agreements will be crucial in driving growth and maintaining margins.