The Rs3,000-crore initial public offering (IPO) of WeWork India Management Ltd (WeWork) has witnessed a muted response from retail and non-institutional investors, with subscription data from the National Stock Exchange (NSE) showing tepid participation from all investor categories, except qualified institutional buyers (QIBs), amid serious governance and disclosure concerns flagged by proxy advisory and corporate governance firm InGovern Research Services (InGovern).
As of Tuesday afternoon, the IPO had been fully subscribed, with retail investors booking 57% of their quota, non-institutional investors 21%, qualified institutional buyers 177% and employees bidding 177% of the quota. In the unlisted market, shares traded flat at around Rs648, the upper end of the price band, with no grey market premium (GMP).
The lukewarm response from retail and non-institutional investors coincides with a scathing governance report from the proxy advisory firm which has cautioned investors about WeWork India’s fragile financials, high lease liabilities, promoter litigations, and complete lack of fresh capital infusion through the offer.
According to
InGovern’s 'Governance Watch: WeWork India IPO – October 2025', the entire Rs3,000-crore issue is an offer for sale (OFS), meaning all proceeds will go to the promoters and existing shareholders like Embassy Buildcon LLP and WeWork Global entities, rather than the company itself and no new shares are being issued. "The IPO proceeds primarily benefit promoters Embassy Buildcon and WeWork International, with anchor investors allotted shares worth about Rs1,348 crore, covering 45% of the issue."
The remainder, open for public subscription, has struggled to attract interest.
“This is purely a liquidity event for the promoters,” the InGovern report notes. “There is no fresh equity infusion for business expansion, debt reduction, or improving liquidity. This structure inherently limits value creation for minority shareholders.”
InGovern’s review reveals that WeWork India’s financials remain under stress, despite headline profits in FY24-25. The company reported a net profit of Rs128 crore for FY24-25 but InGovern points out that the figure arises solely due to a deferred tax credit of Rs286 crore, not an operational turnaround.
The company continues to post negative operating cash-flows and maintains a negative net worth of Rs437.4 crore as of 31 March 2024. Lease rentals alone consume 43.25% of its revenues, while finance costs account for nearly 29%, leaving limited room for profitability.
Occupancy levels, at 80.7%, trail behind peers in the co-working sector at 84%–89%, suggesting slower demand recovery and lower asset utilisation.
“WeWork India’s cost-heavy lease model makes it highly sensitive to demand shocks,” the report says, adding that its dependence on two cities — Bengaluru and Mumbai — for over 70% of revenue increases concentration risk.
InGovern’s report devotes significant attention to ongoing criminal and enforcement cases against WeWork India's promoters Jitendra Virwani and Karan Virwani which, it warns, could undermine investor trust and regulatory compliance.
The promoters face proceedings by the central bureau of investigation (CBI), directorate of enforcement (ED) and economic offences wing (EOW) for alleged offences, including criminal conspiracy, cheating, breach of trust, and money laundering under the Indian Penal Code (IPC) and the Prevention of Corruption Act.
InGovern also highlights investor litigation before the Bombay High Court, where petitioner Vinay Bansal has alleged that WeWork India’s draft red herring prospectus (DRHP) omits critical information, including charge-sheets filed against the promoters. Such omissions could constitute violations of the Securities and Exchange Board of India (SEBI)’s disclosure norms.
“These proceedings raise questions around the ‘fit and proper’ status of the promoters under SEBI regulations,” the InGovern report observed.
WeWork India operates under a 99-year exclusive brand and operational licence from WeWork Global, the US-based entity that went through bankruptcy restructuring in 2023.
InGovern warns that this dependence poses a material existential risk: any loss of promoter control, conviction, or breach of compliance could lead to termination of the licensing agreement, effectively stripping the company of the 'WeWork' brand and related technology platforms.
WeWork India relies on WeWork Global for its technology backbone, including booking systems, visitor management, and workflow software. “Any disruption or ownership change in WeWork Global’s IP could directly affect WeWork India’s business continuity,” the report says.
Between FY21-22 and FY23-24, the company’s auditors flagged material weaknesses in internal financial controls, citing poor documentation in vendor selection, procurement and related-party transactions.
Despite repeated qualifications, the DRHP fails to detail corrective steps, contrary to SEBI’s Listing Obligations and Disclosure Requirements (LODR) norms, the proxy advisory firm says.
InGovern also highlighted extensive related-party transactions within the Embassy group ecosystem, noting that 'board and audit oversight remain inadequate to ensure arm’s-length governance'.
The report further flagged that over 53% of the promoter’s pre-IPO shares had been pledged to secure borrowings worth Rs2,065 crore. While the pledge has been temporarily lifted to meet IPO norms, promoters are contractually required to re-pledge shares if listing does not occur within 45 days, a risk, according to InGovern, which could affect control and price stability.
InGovern’s analysis concludes that the IPO “marks an important moment for the co-working sector but raises fundamental governance concerns."
It calls for SEBI and stock exchanges to scrutinise disclosure adequacy, particularly concerning promoter litigations, control structures and audit remediation. The report also urges independent directors to strengthen oversight post-listing to align governance practices with fiduciary duties.
“The WeWork India IPO underscores a recurring challenge in India’s capital markets — promoter-driven liquidity events packaged as growth stories,” the report cautioned. “Investors should evaluate both the brand potential and the structural fragility before subscribing.”
The tepid market response appears to mirror these concerns. Despite a well-known global brand and India’s growing co-working demand, investor sentiment remains cautious given the combination of regulatory uncertainty, litigation risk and lack of growth capital.
With the issue closing on Tuesday, the IPO’s final subscription tally will indicate whether institutional investors see beyond the red flags — or whether India’s most-hyped workspace brand faces its toughest test in public markets.
