WeWork India Q3 Results: Stock recovers from initial drop as profit expands despite higher costs

Shares of WeWork India Ltd. fell as much as 4% on Tuesday, January 27, in response to their December quarter results, before looking to recover from the initial fall.

On an adjusted basis, the company's revenue grew 9.6% from last quarter to ₹634 crore, while its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) on an adjusted basis grew by 13.7% on a sequential basis to ₹134.6 crore.

Margins on an adjusted basis grew 70 basis points quarter-on-quarter to 21% from 20.3% earlier, while the company reported a profit of ₹52 crore on an adjusted basis, compared to a loss of ₹83 crore last quarter.

WeWork India's core operations, which include WorkSpace as a Service, private and managed offices, contributed to 83.4% of the overall topline during the quarter.

The company now has an operational portfolio of 8.2 million square feet across 73 centres in eight cities, with Assets Under Management (AUM) of 11.4 million square feet. It currently has 1.22 lakh desks under management with an occupancy rate of 83.9%.

Enterprise clients contributed to nearly 74% of the overall topline, with a significant part of new sales coming from expansion of existing members, WeWork said in its media statement.

"Improved occupancy, higher contribution from mature centers, and strong enterprise demand, have enabled us to expand margins year-on-year, while maintaining operational discipline," Karan Virwani, MD & CEO at WeWork India was quoted as saying.

Shares of WeWork India have recovered from the lows of the day, currently trading 1% higher at ₹585.4. The stock is down around 10% from its issue price, in-line with the recent fall seen in most real estate stocks.