Indiqube: Is Indiqube Spaces’ IPO a risky bet amidst growing losses?

ET Intelligence Group: Indiqube Spaces, a workplace solutions firm, plans to raise ₹650 crore through a fresh issue to fund capex plans and partially repay debt. It also has an offer for sale of ₹50 crore. The promoter stake will fall to 60.6% after the IPO from 70.9%. The company operates in a sector with strong potential for growth. It has 115 centres across 15 cities. About 63% of its revenue comes from Bengaluru, reflecting geographic concentration. Though revenue and operating profit before depreciation and amortisation (Ebitda) has increased in the past two years, the company continues to report net loss. Given these, investors may wait to see clarity in financials.

Business

Incorporated in 2015, Bengaluru headquartered Indiqube Spaces provides managed, sustainable, and technology-driven workplace solutions. The company’s backward integration focuses on asset renovation, upgradation and customised build-to-suit models. It also provides value-added-services (VAS) to clients and their employees. It manages a portfolio of 115 centers across 15 cities, consisting of 105 operational centres and 10 centres for which Indiqube has executed letters of intent, covering 8.4 million square feet of area under management with a total seating capacity of 186,719 as of March 2025.

Financials
Revenue from operations and Ebitda grew 35.2% and 61.4% annually to ₹616.5 crore and ₹236.7 crore, respectively between FY23 and FY25. Net loss declined to ₹139.6 crore in FY25 from ₹198.1 crore in FY23, while Ebitda margin grew to 58.2% from 40.83%, better than its listed peer Awfis Space Solutions which is around 33.3%. Net Debt was at ₹337.9 crore, out of which ₹93 crore will be paid from IPO proceeds. Awfis, on the other hand, runs cash positive operations (no debt).

Valuation

Price-to-earnings multiple will not help since the company is yet to record profits. The price-to-sales (P/S) multiple works out to 4.7 compared with 3.7 for Awfis. The enterprise value of Indiqube works out to be 8.6 times of Ebitda while it is 11.2 times for Awfis.