Smartworks Coworking Spaces Limited - IPO

1. During Fiscal 2025, we derived 75.19% of our Rental Revenue from our Centres located in Pune, Bengaluru, Hyderabad and Mumbai. Any adverse developments affecting such locations and Centres could have an adverse effect on our business, results of operations and financial condition.

2. Our business is focused on Clients who typically require over 300 Seats across multiple Centres and cities. We may not have equal negotiating power with such Clients and it may be difficult for us to find suitable replacements upon termination of agreements with such Clients, which could adversely affect our business, cash flows, results of operation and financial performance.

3. Our success largely depends on our ability to identify the right buildings/ properties in right locations and sourcing such Centres at the right rate of rental and other commercial terms. Any failure to do so will adversely affect our business, cash flows, results of operations and profitability.

4. Our Company and certain of our Subsidiaries have incurred losses and we have experienced negative cash flows in the past. We cannot assure you that we will achieve or sustain profitability and not continue to incur losses going forward.

5. Our Landlords may not renew leases of existing Centres with us or renegotiate terms of our leases which could adversely affect our business, cash flows, results of operation and financial performance.

6. We have entered into long-term fixed cost lease agreements with our Landlords, for super built-up area of 8.99 million square feet across 50 Centres across 15 cities, as of March 31, 2025. If we are unable to pay the lease rentals to our Landlords on account of failure to source Clients for workspaces within our Centres, our business, results of operations, cash flows and profitability may be adversely impacted.

7. We may not be able to continue to retain existing Clients, our existing Clients may prematurely terminate their agreements with us and we may not be able to attract new Clients in sufficient numbers, which could adversely affect our business, results of operations, cash flows and financial condition.

8. Our revenue from operations have grown at a CAGR of 38.98% from Rs. 7,113.92 million in Fiscal 2023 to Rs. 13,740.56 million in Fiscal 2025. We may not be successful in managing our growth effectively.

9. Our Statutory Auditors had provided a qualified opinion in our consolidated audit report on internal financial controls for Fiscal 2023. If we fail to maintain an effective system of internal controls, we may not be able to successfully manage, or accurately report, our financial risks. Despite our internal control systems, we may be exposed to operational risks, which may adversely affect our reputation, business, financial condition, results of operations and cash flows.

10. Our growth may be negatively impacted by macroeconomic factors, such as level of economic activity in the regions and cities in which we operate, interest rate fluctuations and emergence of alternative destinations. Additionally, a significant portion of our Rental Revenue can be attributed to Clients in the information technology industry. Any adverse change in the aforementioned macroeconomic factors or any adverse impact on the information technology industry may impact our business, results of operations and financial condition.