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Bengaluru-based Indiqube Spaces is the latest company to tap into the IPO wave. And if the grey market is to be believed, this workspace provider might be in for a solid stock market debut. Its grey market premium (GMP) has been holding strong in the Rs 31-40 range, suggesting a 13 per cent listing gain over its Rs 237 issue price. Not bad for a company that’s still loss-making.
But is the hype justified? Let’s break it down.
What’s on offer
Indiqube’s Rs 700 crore IPO opens on July 23 and closes on July 25. The issue includes Rs 650 crore of fresh shares and Rs 50 crore through an offer for sale. The price band has been fixed at Rs 225-237 per share, valuing the company at around Rs 5,000 crore at the top end.
The company plans to use most of the fresh funds to expand its network of managed workspaces and repay around Rs 93 crore of debt.
Who is Indiqube?
Indiqube offers managed office spaces: Think flexible workstations, private offices and meeting rooms, all under a tech-enabled setup. The company operates in 15 cities, with 115 centres covering 8.4 million square feet and a seating capacity of nearly 1.9 lakh.
Let’s talk numbers
The company has posted strong topline growth:
| Metric | FY24 | FY23 | YoY change |
|---|---|---|---|
| Revenue | Rs 1,102.9 crore | Rs 869.8 crore | 27 per cent |
| Net loss | Rs 139.6 crore | Rs 341.5 crore | - 59 per cent |
Other key numbers (as per reports and DRHP):
- EBITDA margin: 60 per cent
- ROE: - 2.2 per cent
- ROCE: 34 per cent
- Estimated market cap: Rs 5,000 crore
Why is the GMP high?
Here’s what could be powering the bullish grey market sentiment:
- Strong revenue growth: 27 per cent YoY rise shows scale-up is happening.
- Losses narrowing fast: That Rs 139 crore net loss in FY24 was a big improvement from Rs 341 crore the year before.
- Sector tailwinds: Post-pandemic, companies are opting for flexible workspaces instead of long-term leases.
- Use of proceeds: Most of the IPO money is going towards expansion, which could mean higher revenues and eventually profits.
The catch
While a double-digit GMP is exciting, don’t ignore the risks:
- Still not profitable: The EPS is negative. So, no P/E ratio to evaluate.
- High competition: Established players like Awfis already have a head start.
- Leverage risk: The company still carries significant debt, though it’s trying to bring it down.
And remember—GMP can be fickle. What looks like a surefire listing gain today could fizzle out quickly if market sentiment changes.
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Disclaimer: This story was created with the assistance of artificial intelligence and has been reviewed by human experts for accuracy and is intended for informational purposes only. Please do your own due diligence and research before making any investment decisions.
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