AWFIS Space Solutions Ltd IPO

The company has a history of net losses, negative earnings per share ("EPS") and return on net worth ("RoNW"). The company need to generate and sustain increased revenues while managing its expenses to achieve profitability, and its inability to achieve these goals may have an adverse effect on its business, results of operations, cash flows and financial condition.

The company has experienced negative cash flows in previous Fiscals and may continue to have negative cash flows in the future.

Its business has grown rapidly, including the company revenue from contract with customers that has grown at a CAGR of 74.85% from Rs.1,783.60 million in Fiscal 2021 to Rs.5,452.82 million in Fiscal 2023, and its may fail to manage its growth effectively.

Its growth may be negatively impacted by macroeconomic factors.

The company may not be able to attract new clients in sufficient numbers, continue to retain existing clients, a portion of whom enter into service agreements ("Client Agreements") with short-term commitments, or agree sufficient rates to sustain and increase its client base or at all.

The company enter into Space Owner Agreements to render operation and marketing services in relation to its managed aggregation ("MA") centers and are subject to risks related to such Space Owner Agreements.

Its MA model requires the company to identify, partner with space owners and agree to profit or revenue sharing models with these owners. Its cannot assure you that the company will be able to attract new space owners on favorable terms in order to grow its business and overall profitability.

The company may incur additional capital expenditure under its MA model to attract new clients and retain existing clients, which may impact its cash flows and profitability.

The company relies on its customer relationships to grow its business and generate revenues. Any negative customer experience may impact its ability to attract or retain clients and impact its growth and profitability.

The company has entered into long-term fixed cost leases, i.e., SL for 1.94 million sq. ft. covering 62 total centers across 11 total cities and 9 states and 33.57% of its total seats as of December 31, 2023, which may result in adverse impact in its liquidity, results of operations, cash flows and profitability.