Dev Accelerator IPO Review: From Tier-2 Titan to Global Contender in India’s Flex-Space Boom

The Indian flexible workspace sector is witnessing rapid transformation, becoming an essential component of corporate real estate strategies. With occupiers increasingly seeking customized, asset-light, and service-driven office solutions, the industry has grown from 18.6 mn sq. ft. in 2018 to 74 mn sq. ft. in 2024, and is projected to nearly double by 2028 (JLL Report).

Amidst this backdrop, Dev Accelerator (DevX) has emerged as one of the largest flexible space operators in Tier 2 markets, complementing its presence in Tier 1 cities. Now, the company is coming out with its IPO scheduled for 10 -12 September 2025, with a price band of INR 56–61 per share. The entire issue is a fresh offering of 2.35 crore shares, amounting to INR 131.6–143.35 crore, earmarked for expansion fit-outs, debt repayment, and corporate purposes. We take a deeper view at the operations in Dev Accelerator IPO review.

Dev Accelarator IPO Review: Company Overview

Dev Accelerator is not just a coworking operator; it is positioned as a comprehensive workspace solutions provider. The company’s vision is to serve as a one-stop partner for enterprises of all scales — from startups to large MNCs — by combining real estate, design, technology, and facility services under one umbrella.

Scale of Operations (as of 31 May 2025):

• 28 operational centers across 11 cities including Delhi NCR, Mumbai, Pune, Hyderabad, Ahmedabad, Gandhinagar, Indore, Jaipur, Udaipur, Rajkot, and Vadodara.
• 14,144 seats with 8,60,522 sq. ft. super built-up area.
• 250+ active clients, ranging from large corporates (e.g., Zomato, Wipfli, Paperchase) to SMEs and freelancers.
• Subsidiary & Associate Network:
• Neddle and Thread Designs LLP – design & execution services.
• Saasjoy Solutions – IT/ITeS solutions.
• Scaleax Advisory – advisory for Global Capability Centers (GCCs).

In simple terms, DevX handles the complete lifecycle of workspace creation and operation – sourcing the property, designing interiors, building out infrastructure, maintaining facilities, and even extending allied HR and IT support to clients.

DevX IPO Review: Business Model Analysis

DevX business model is multi-pronged, built to capture stable annuity-style revenues while also tapping into higher-margin service verticals.

1. Managed Office Solutions (Core Business)

• Target Clients: Large corporates requiring 100–500 seats.
• Contracts: Lease tenures of 5–9 years with 3.5–5 years lock-in periods.
• Revenue Stability: Long-term agreements ensure predictable cash flows, high renewal potential, and strong client relationships.
• FY25 Revenue Contribution: INR 93.38 crore (~59% of total revenue).
• Premium vs Standard Centers:
  • Premium: In Grade A+ buildings (Mumbai, Pune, Ahmedabad, Jaipur, Udaipur), with higher fit-out costs and margins.
  • Standard: Economical offerings (IT/ITeS hubs) for cost-sensitive clients.

This segment is DevX’s bedrock, creating high visibility and credibility in the corporate workspace market.

2. Co-working Spaces

• Caters to freelancers, startups, SMEs, and remote workers.
• Offerings include private cabins (8–50 seats), dedicated desks, individual desks, manager cabins, and meeting rooms.
• Revenue Model: Per seat pricing; lock-ins range from 3 months (desks) to 4 years (cabins).
• FY25 Revenue Contribution: INR 8.91 crore (~6%).
• While a smaller contributor, it enhances brand visibility and customer acquisition funnel, feeding clients into larger managed spaces.

3. Design & Execution Services

• Delivered through Neddle and Thread Designs LLP.
• Covers both DevX-owned centers and external client offices (7,000–8,000 sq. ft. projects).
• Contracts involve advance + milestone-based payments.
• FY25 Revenue Contribution: INR 40.30 crore (~25%).
• Acts as a capital-light, high-margin vertical, complementing recurring rental revenues.

4. Allied Services

DevX has gone beyond workspace rentals by offering value-added services that create stickiness:

• Payroll Management – end-to-end HR compliance.
• Facility Management – IT infra, housekeeping, valet, security.
• IT/ITeS – software development, cloud, data analytics, digital marketing (via Saasjoy).

These services, though smaller in scale, strengthen customer relationships, improve client retention, and diversify income sources.

5. Asset Procurement Models

DevX operates under four different asset sourcing frameworks, ensuring flexibility and risk balancing:

1. Straight Lease (75% centers) – fixed rentals; DevX bears fit-out costs but enjoys full revenue upside.
2. Furnished by Landlord (21%) – capex-light; landlord provides ready-to-use centers.
3. Revenue Share (GIFT City center) – landlord gets 60% revenue share with minimum guarantee.
4. OpCo–PropCo (new initiative) – separation of operations from property ownership; DevX invests via Janak Urja and Ausil Enterprises for strategic control.

This blended strategy enables capital efficiency, expansion flexibility, and long-term scalability.

6. Expansion Strategy

• Planned 8 new centers (9,40,961 sq. ft.) in the next two fiscals.
• IPO proceeds to fund 4 large centers (6,64,692 sq. ft.).
• International foray: Sydney, Australia (498 seats, FY26 launch).
• Domestic pipeline: Surat, Pune, Ahmedabad (3,199 new seats planned).

This expansion strategy underlines DevX ambition to consolidate its leadership in Tier 2 markets while also stepping onto the global stage.

Dev Accelerator IPO Review: Revenue Streams Breakdown

Dev Accelerator revenue streams is diversified across sixsegments, though the managed office solutions segment is the dominant contributor. The company has consistently grown across all verticals while maintaining strong visibility in its core business.

Segment-Wise Revenue Contribution

Particulars	FY25	% of Revenue	FY24	% of Revenue	FY23	% of Revenue
Managed Office Spaces	93.38	58.8%	74.04	68.5%	35.31	50.5%
Co-working Spaces	8.91	5.6%	8.52	7.9%	4.77	6.8%
Payroll Management	2.22	1.4%	3.89	3.6%	3.47	5.0%
Design & Execution	40.30	25.4%	18.57	17.2%	22.08	31.6%
Facility Mgmt & Others	5.89	3.7%	3.07	2.8%	4.28	6.1%
IT/ITeS Services	8.18	5.2%	–	–	–	–
Total	158.88	100%	108.09	100%	69.91	100%

Key Takeaway:

• Managed Spaces remain the backbone, contributing nearly INR 93.4 crore in FY25. The long-term lease contracts give stable and predictable revenues.
• Design & Execution has emerged as the fastest-growing segment, contributing 25%+ in FY25, highlighting DevX’s strength in turnkey build-outs.
• IT/ITeS Services entered in FY25 and already contributes INR 8.2 crore (5%), showing the company’s diversification beyond traditional workspace.
• Coworking revenue remains small (~6%), but strategically important for pipeline building.

City-Wise Revenue Contribution

DevX has a Tier 2 focused footprint, with Tier 2 cities contributing two-thirds of revenues.

Location	FY25	FY24	FY23	Centers
Tier 1 Cities	40.24	34.51	20.26	10
Tier 2 Cities	80.40	63.54	40.36	16
Total	120.64	98.04	60.62	26

Key Takeaway:

• ~67% of revenue comes from Tier 2 markets, validating DevX’s positioning as a Tier 2 leader.
• Ahmedabad alone contributed INR 48.28 crore in FY25, showing dominance in its home state of Gujarat.
• This strategic presence in Tier 2 cities gives DevX an edge where demand is rising faster post-COVID.

Dev Accelerator IPO Analysis: Financial Performance

Dev Accelerator has demonstrated strong revenue growth, improving profitability, and deleveraging, though profitability remains modest at the bottom line.

Key Financial Metrics

Particulars	FY2023	FY2024	FY2025
Revenue from Operations	69.91	108.09	158.88
EBITDA	29.88	64.74	80.46
EBITDA Margin (%)	42.7%	59.9%	50.6%
Net Profit / (Loss)	(12.83)	0.44	1.77
Net Profit Margin (%)	(17.9)%	0.4%	1.0%
ROCE (%)	3.7%	17.3%	25.9%
Debt / Equity (x)	27.2	3.5	2.4
Occupancy (%)	80.9%	83.1%	87.6%

Key Takeaway:

• Revenue CAGR of ~50.8% (FY23–25) reflects strong business momentum.
• EBITDA margins are industry-leading, consistently above 50% in FY25 despite expansion-related costs.
• Net profitability turned positive in FY24–25 after losses in FY23, showing improved scale efficiency.
• ROCE improved sharply to 25.9% in FY25, driven by better asset utilization.
• Debt/Equity ratio reduced from 27.2x (FY23) to 2.4x (FY25), reflecting aggressive deleveraging. IPO proceeds will further reduce leverage.

Industry Tailwinds

The broader flex space industry in India is witnessing unprecedented growth:

• Market Expansion: Flex stock grew from 18.6 mn sq. ft. in 2018 to 74 mn sq. ft. in 2024 (26% CAGR). It is projected to reach ~129 mn sq. ft. by 2028.
• Leasing Demand: In 2024, flex spaces accounted for 20% of India’s gross leasing activity, highlighting structural demand.
• Tier 2 Surge: Stock in Tier 2 cities has tripled since 2021, fueled by cost advantages, talent availability, and improved infrastructure.
• GCC Growth: Global Capability Centers in India already occupy ~245 mn sq. ft. (34% of Grade A stock). Expected to cross 300 mn sq. ft. by 2028, creating demand for high-quality managed offices.

Implication for DevX:

• Positioned as a Tier 2 leader with 67% revenue from non-metros, DevX is aligned with the fastest-growing segment of the market.
• Long-term contracts, strong occupancy, and diversification into IT/ITeS and design services position it to capture industry tailwinds sustainably.

DevX IPO Review: Valuation Analysis

The workspace solutions industry is still in its hyper-growth phase. This is similar to the stage where Zomato and Swiggy showcased aggressive topline expansion, and the market focused on growth potential rather than short-term profitability.

In the same way, for companies like DevX and its peers, traditional profitability ratios such as EPS and P/E are not the right yardstick. Instead, investors should focus on EBITDA margins, Price-to-Sales, Price-to-Book, and Sales Growth to evaluate their true potential.

🔹 EBITDA Margins: Operational Strength

• DevX: 50.6% (Industry-leading efficiency)
• Smartworks: 62.4% (highest, though still loss-making)
• Indiqube: 58.2% (strong margins but negative equity)
• Awfis: 35.4% (solid but lower comparatively)

DevX’s 50%+ EBITDA margin is a clear proof of a lean and cash-generative business model. Maintaining margins while scaling growth is a golden combination for investors.

🔹 Price-to-Sales (P/S): Growth Premium

• DevX: 3.46x
• Awfis: 3.21x
• Smartworks: 4.38x
• Indiqube: 4.60x

DevX’s P/S is balanced and justified, reflecting investor confidence while still being sustainable compared to peers.

🔹 Price-to-Book (P/B): Market Confidence

• DevX: 7.94x
• Awfis: 8.96x
• Smartworks: — (distorted due to losses)
• Indiqube: — (distorted due to negative equity)

With a P/B of 7.94, the market is valuing DevX at multiple times its book value — a natural signal of strong growth expectations.

🔹 Growth Momentum: Sales Expansion

• DevX: ~50.7% CAGR (fastest among peers)
• Awfis: ~38.9% CAGR
• Smartworks: ~40.2% CAGR
• Indiqube: ~34.6% CAGR

DevX clearly emerges as the growth leader in the industry. With such strong revenue momentum, its market share and valuation are likely to expand rapidly.

🔹 Balance Sheet & Liquidity: Managing Growth Wisely

Debt-to-Equity (D/E):

• DevX: 2.39 → Moderate leverage, helping accelerate growth while keeping risk controlled.
• Peers: Smartworks (3.69), Awfis (3.08), Indiqube (23.5) due to negative equity).

DevX is using debt strategically as growth capital, unlike peers where balance sheets are either over-leveraged or distorted by negative equity.

Current Ratio:

• DevX: 0.69 → Tight but manageable, typical for high-growth companies reinvesting cash into expansion.
• Peers: Smartworks (0.21), Indiqube (0.26), Awfis (0.71).

Dev Accelerator IPO Review highlights that the company offers a rare combination:

• High Growth (fastest revenue CAGR)
• High Margins (50%+ EBITDA)
• Strong Occupancy (87%+)
• Investor Confidence (premium multiples, yet reasonable vs peers)
• Balanced Leverage (moderate D/E)
• Better Liquidity (higher current ratio than most peers)

While peers are still grappling with profitability challenges, DevX’s balanced growth + efficiency strategy makes it stand out. Historically, markets have rewarded such models — much like Zomato and Swiggy in their early years.

DevX IPO Details & Objectives

Particulars	Details
IPO Dates	10 – 12 September 2025
Price Band	INR 56 – INR 61 per share
Issue Size	2.35 crore shares (~INR 131.6 – 143.35 crore)
Fresh Issue / OFS	100% Fresh Issue
Lot Size	235 shares (~INR 14,335 minimum investment)
Listing	BSE & NSE
Retail Quota	10%
Employee Quota	1.65 lakh shares

Utilisation of Proceeds:

• INR 73.12 crore – Fit-outs for new centers.
• INR 35.0 crore – Debt repayment including redemption of NCDs.
• Balance – General corporate purposes.

Shareholding Snapshot (Pre-Issue, Major Holders):

• Dev Information Technology – 21.9%
• Promoters Parth Shah, Rushit Shah, Umesh Uttamchandani – ~9.3% each
• Others include Parashwanath Land Organisers LLP, Unmaj Corporation LLP, Siddhant Investments, Tipsons Consultancy, etc.

Dev Accelerator IPO Review: Strengths

1. Tier 2 Market Leadership
   • Among the largest flex space operators in Tier 2 cities by operational stock.
   • Occupancy consistently above 87%, showcasing robust demand.
2. Diversified Service Portfolio
   • Beyond office rentals, DevX offers design & execution, payroll, facility management, IT/ITeS – ensuring multiple revenue streams.
   • Helps in cross-selling and improving client stickiness.
3. Customer-Centric Business Model
   • Zero-capex model for clients – enterprises move into plug-and-play offices without upfront investment.
   • Customizable, tech-driven solutions and strong facility management ensure long-term client retention.
4. Financial Momentum
   • Revenue CAGR of 50.8% (FY23–25), EBITDA margins above 50%, and turnaround to profitability.
   • Rapid deleveraging with Debt/Equity improving from 27.2x (FY23) to 2.4x (FY25).
5. Experienced Promoters & Management
   • Founders with 21+ years cumulative experience in flexible workspace.
   • Supported by professional management and independent directors with deep industry expertise.

Dev Accelerator IPO Review: Risks & Challenges

1. Client Concentration Risk: Top 10 clients contribute ~39% of revenue, making DevX dependent on a few large accounts.
2. Capex-Intensive Model: Straight lease model requires significant upfront fit-out costs, impacting cash flows during expansion.
3. Thin Net Margins: Despite strong EBITDA, PAT margin remains low at 1% in FY25, which could be impacted by debt servicing or economic downturns.
4. Competition: Faces competition from Awfis, Smartworks, Indiqube, and emerging regional operators, especially in Tier 1 markets.

Conclusion

Dev Accelerator (DevX) presents itself as a fast-scaling, Tier 2 focused flex space leader with a robust business model and diversified service offerings.

• Positives:
  • Strong revenue growth (CAGR 50%+).
  • Consistently high occupancy (>87%).
  • Long-term contracts ensuring revenue visibility.
  • Expanding beyond workspaces into IT/ITeS and allied services.
  • IPO proceeds targeted at growth + deleveraging, both value accretive.
• Concerns:
  • Margins at the net profit level remain thin.
  • Capex-heavy model may weigh on free cash flows in expansion phases.

For investors with a long-term horizon, DevX offers exposure to a high-growth industry with structural tailwinds and a company well-positioned to capture Tier 2 opportunities. While short-term valuations appear stretched due to low EPS, the strategic expansion, strong occupancy, and diversified services make it an attractive growth story in India’s evolving flex workspace market.

So far, three co-working space providers in India—Awfis, Indiqube, and Smartworks—have been listed, with an average listing gain of 3.81%. Collectively, these companies have raised approximately INR 1,881.81 crore from the market.

A clear trend has been observed with these companies: while their listing performance tends to be relatively modest, they have historically gone on to deliver strong post-listing returns. For example, Awfis has generated returns of 51.36% from its IPO price to the current level, while Smartworks has delivered returns of 29.39% over the same measure.