Shares of WeWork India slipped nearly 2 %, trading at around ₹634.50, during their market debut, falling from the ₹648 IPO price. The drop underscores investor wariness even after its $338 million public offering.
The company raised 30 billion rupees through the IPO, which was fully subscribed on the final day, largely driven by institutional demand. Retail investor participation remained modest, highlighting reservations about valuation and risk.
Market Sentiment, Valuation & Risks
The drag on share performance stems from several factors. The valuation at the IPO was viewed as aggressive compared to peers, especially in a capital-intensive, margin-sensitive sector. Concerns over corporate governance and transparency have led many investors to tread cautiously.
Ahead of listing, advisory firms flagged weak cash flows, high lease liabilities, and a lack of fresh capital infusion. These warnings amplified doubts about the firm’s sustainability in an environment of rising interest rates and real estate pressure.
WeWork India operates under a licensing agreement with its U.S. namesake, which has undergone multiple restructurings. The local firm competes with listed co-working peers that have shown more tempered valuations and clearer profit paths.
Investor Caution and Long-Term Outlook
Despite the lukewarm start, analysts say the long-term fundamentals for flexible workspaces remain intact. India’s shift toward hybrid work and growing startup ecosystem continue to drive strong underlying demand.
As previously covered, India’s office leasing market has rebounded sharply since 2023, with flexible spaces now accounting for nearly 15% of total new commercial leases. The challenge for WeWork India will be to sustain occupancy rates above 80% while navigating higher rent and capital costs.
For now, the debut highlights the broader tension between market optimism over India’s economic expansion and investor caution about asset-heavy business models. The company’s performance in the coming quarters will likely determine whether this IPO marks a temporary dip or a cautious start to longer-term growth.
