Executive Centre India Limited IPO

01At a glance

What the company does — leases office space in Grade A buildings from landlords, then designs, builds and operates it as premium flexible workspace for clients including multinational corporations (DRHP p.21). At March 2025 it had 89 operational centres in 14 cities in seven countries: India, Singapore, the Middle East, Indonesia, Vietnam, the Philippines and Sri Lanka (DRHP p.21).

Who pays it — client companies, through licence fees, which were 84.69% of FY25 revenue; it served 1,560 unique clients in FY25, and the top ten were 18.41% of licence-fee income (DRHP p.25). Centres outside India provided 54.34% of FY25 revenue (DRHP p.25).

Why it is raising money — ₹24,100.00 million to invest in its subsidiary TEC Abu Dhabi, which will use it to pay part of the price for TEC SGP and TEC Dubai to the promoter The Executive Centre Singapore, and the rest for general purposes (DRHP p.22).

How fast it has grown — revenue from ₹7,634 million in FY23 to ₹10,366 million in FY24 and ₹13,226 million in FY25 (DRHP p.23).

The one thing to understand — most of the IPO money goes to the promoter group, as payment for businesses it moved into the Indian company. In March 2025 the company's subsidiary bought seven TEC entities from The Executive Centre Singapore for US$398.90 million, about ₹34,436 million, partly through non-interest-bearing promissory notes of about ₹27,294 million that the proceeds will partly repay (our arithmetic, DRHP p.116). Under common-control accounting this left total equity at negative ₹27,284 million (DRHP p.510).

02The business, in plain words

A flexible-workspace operator signs long leases on office floors, fits them out as furnished offices, meeting rooms and shared areas, and licenses desks or private suites to companies for shorter terms, earning the gap between what clients pay and the rent and running costs.

A multinational needs a 40-desk office in Bengaluru → it signs a licence agreement for a suite in a TEC centre → TEC provides the fitted office and shared facilities → the client pays a monthly licence fee, and TEC pays rent to the building's landlord.

Earnings equation: Profit ≈ occupied workstations × revenue per workstation − rent and lease costs − centre operating costs − depreciation, interest and royalty to the TEC group. Adjusted EBITDA after lease payments was ₹2,151.48 million, 16.27% of FY25 revenue (DRHP p.130).

03Where the money comes from

Source: DRHP p.25, DRHP p.130, DRHP p.131.

04The growth record

Source: DRHP p.23, DRHP p.42, DRHP p.130. EBITDA is before lease payments, which the document shows separately: ₹4,924.88 million in FY25 (DRHP p.42, DRHP p.130).

05What the growth is made of

More centres and higher prices. Operational centres rose from 63 to 89 and workstation capacity by 40% in two years, while revenue per occupied workstation rose from ₹49,233 to ₹60,361 (our arithmetic, DRHP p.130, DRHP p.131). Net revenue retention was 120.33% in FY25 (DRHP p.131).

06Earnings quality

Lease payments of ₹11,691.28 million over FY23 to FY25 were 56% to 65% of each year's operating cash flow, which totalled ₹19,213.50 million (our arithmetic, DRHP p.42). After lease payments, adjusted EBITDA margin fell from 21.58% to 16.27% (DRHP p.130). Royalty to other TEC group entities was 5.54% of FY25 revenue and service charges 5.29%, up from 2.93% and 2.16% in FY23 (DRHP p.25).

07The balance sheet

Source: DRHP p.23, DRHP p.130. The negative equity comes mainly from a common-control adjustment deficit reserve created on acquiring the subsidiaries from the promoter group (DRHP p.510).

08What the money is for

Source: DRHP p.22. The promissory notes to be paid are US$145.12 million for TEC SGP and US$171.04 million for TEC Dubai, about ₹12,528.01 million and ₹14,765.64 million; The Executive Centre Singapore has agreed not to demand payment until a date agreed in writing (DRHP p.116, DRHP p.117).

09Who is selling

Nobody. The issue is a fresh issue only, of up to ₹26,000.00 million (DRHP p.21). The weighted average cost of shares acquired in the last three years was ₹36.76 (DRHP p.27).

10Promoters

The promoters are George Raymond Zage III, Paul Daniel Salnikoff, Willow HoldCo Pte. Ltd., The Executive Centre Singapore Pte Ltd and Intelletec Limited (DRHP p.21). The Executive Centre Singapore holds 99.67% and Intelletec 0.33% (DRHP p.22). No proceedings are listed against the promoters (DRHP p.24).

11Who already owns it

Source: DRHP p.22. These are the only shareholders (DRHP p.23).

12What changed just before the IPO

• Restructuring — seven TEC entities in Singapore, the Middle East and Asia bought from the promoter group in March 2025 (DRHP p.116).
• Share split — ₹10 shares split into ₹2 shares in May 2025 (DRHP p.27).
• Royalty — payments to the TEC group nearly doubled as a share of revenue (DRHP p.25).

13Capacity and expansion

Capacity is leased space: 2.02 million sq. ft. and 21,377 workstations at March 2025 (DRHP p.130). The proceeds do not fund new centres (DRHP p.22). Mumbai, Gurugram and Bengaluru held 60.88% of India workstations (DRHP p.25).

14Market size and industry structure

The CBRE report cited in the offer document forecasts India's non-SEZ office stock at about 884 million sq. ft. by 2027, and office stock in Dubai, Abu Dhabi and Singapore at about 116, 54 and 66 million sq. ft. (DRHP p.21). Those forecasts are CBRE's, and newboard has not tested them.

15Competitive position

What the document claims, and what it rests on:

• Premium positioning — Grade A buildings and multinational clients (DRHP p.21, DRHP p.123).
• Occupancy — above 91% in operational centres (DRHP p.131).
• Pan-Asia footprint — seven countries (DRHP p.21).

Against that: losses, long lease commitments, reliance on the TEC group for its brand and business teams, and more than half of revenue earned abroad (DRHP p.24, DRHP p.25).

16Peers the company named

Source: DRHP p.127.

No P/E is possible for the company until a price band is set, and it made a loss in FY25.

17Risks, in plain words

• Proceeds to the promoter. ₹24,100 million goes to pay for subsidiaries bought from the promoter group (DRHP p.22).
• Losses. Losses in all three years, widening to ₹806 million (DRHP p.23).
• Leases. Lease payments took 65% of FY25 operating cash flow (DRHP p.42).
• Group dependence. The TEC brand, clients, landlords and teams come through other group entities (DRHP p.25).
• Abroad. 54% of revenue is from outside India (DRHP p.25).

18Litigation and regulatory matters

Source: DRHP p.24. No other proceedings are listed against the company, its subsidiaries, directors or promoters (DRHP p.24).

19Related-party transactions

The purchase of the seven TEC entities from The Executive Centre Singapore for US$398.90 million is the main related-party transaction (DRHP p.116). Royalty and service charges to the TEC group were together 10.83% of FY25 revenue (our arithmetic, DRHP p.25).

20What the offer document does not say

In the sections read for this study, the document does not give:

• How the US$398.90 million price for the TEC entities was set, in the pages read.
• When the promissory notes will be paid if the issue is delayed, beyond the letter agreement (DRHP p.117).
• How the royalty rate to the TEC group is fixed, in the pages read.
• What the 14 tax proceedings concern, in the pages read.
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. How was the US$398.90 million price for the TEC entities valued?
2. Why fund the payment to the promoter with IPO money rather than equity from the promoter group?
3. Why did royalty and service charges to the TEC group rise from 5% to 11% of revenue?
4. When will the business report a profit after lease costs?
5. How long are the leases compared with client licence terms?

1Sources and cited facts

This study was read from 1 document the company filed. The 35 figures it cites are listed under the document each came from, with the page and the sentence as printed.