Dev Accelerator Ltd (NSE: DEVX) Q3 2026 Earnings Call dated Feb. 02, 2026
Corporate Participants:
Umesh Uttamchandani — Managing Director
Analysts:
Unidentified Participant
Shamit — Analyst
Rohit Mehra — Analyst
Anant Mundra — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Dev Accelerator Limited Q3 and 9 months FY26 earnings conference call. I have with me Mr. Pad Shah, Chairman and Whole Time Director Mr. Umesh Uttamchannani, Managing Director Mr. Rushit Shah, Whole Time Director Mr. Parin Shah, Joint Chief Financial Officer Mr. Parthiv Panchal, Joint Chief Financial Officer Mr. Anjan Trivedi, Company Secretary Compliance Officer Mr.
Yash Shah, Non executive, non Independent Director before we proceed, I would like to bring to your attention that certain statements made during this discussion may constitute forward looking statements. These statements are based on current expectations, assumptions and beliefs regarding future development and are inherently subject to various risks, uncertainties and factors beyond our control. Such forward looking statements involve both known and unknown risks and we advise you to interpret them with caution. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your Touchstone phone. I now hand the conference over to Mr. Umesh Utam Chandani, Managing Director for his opening remarks.
Umesh Uttamchandani — Managing Director
Thank you Moderator. Good afternoon everyone and a warm welcome to Dave Accelerator Limited’s earnings conference call for the quarter and nine months ended December 31st, 2025. I trust all of you had an opportunity to review the results that we have shared on our website and also on the stock exchanges and along with it we have also shared investor presentation and the media releases. I’ll start by sharing a quick brief as to what we do as an organization. Dev Accelerator Ltd. Which we brand as DevX, is an enterprise focused full solution managed workspace platform. What we essentially do is design, build and provide custom built offices which covers end to end site selection, bespoke fit outs, technology integration, payroll management and facility management all under a single service level agreement.
So technically a client gives or issues a single check to us for seeking all the services which I mentioned about. So we started this company back in 2017 with a clear conviction that India’s tier 2 cities would become the frontier for future commercial real estate consumption. Back then when we were starting not only in the country but even in Ahmedabad, the city where we started from, the closest competition that we had was a 50 seater service provider and we started with 700 seats being offered to the city. And that’s when the belief became stronger. Instead of Bangalore, Mumbai and Delhi, we started to build our foundation in Ahmedabad, Baroda, Jaipur, Rajkot, Udaipur and few other emerging cities which we believe would pave the way for next growth of the country.
Seven years later, the budget which has been announced yesterday showcased the condition that the next growth opportunity would come in from the tier two cities. And this transition is is not just by numbers. It is a structural reform that happening in the country as well as in the industry. Today Devex operates 28 centers across 12 cities managing almost 9 lakh square feet of area with 13,500 seats operating at an 88 percentage occupancy levels which is being consumed by more than 300 clients. And astonishingly which is not the truth of the industry, 95% of our seats or inventory is sourced directly.
What makes us fundamentally different from other flex operators is our core focus on tier 2 strategy. 75% of our revenue today comes from tier 2 cities. Just to define few of the tier 2 cities is cities like Ahmedabad, Baroda, Jaipur, Gandhinagar, Surat, Indore, Rajkot and Udaipur. The remaining 25% of our revenue comes from tier one cities like Pune, Hyderabad, Noida and Mumbai wherein we expand categorically with a back to back demand coming in from clients. And this shift or focus in tier 2 cities is not merely by accident. It is a deliberate strategy to focus on these growth corridors.
We understand these extremely deeply. And the lack non institutional in nature very difficult to deal with is where we understand the pulse. We also understand the talent pools here because that is the critical aspect for our clients. The enterprise demand patterns basis, the growth of office spaces which are being built basis the availability of talent pool. And all of this supported with regulatory environment is where we understand in and out of it. And this ultimately results into superior unit economics. Because our rent to revenue ratio in tier 2 cities stands at 2.62x while in tier 1 cities it is 2.1x.
This showcases that our strategy is impacting on ground and is not just a mere love towards tier 2 cities but it translates into positive numbers as well. What our rent to revenue ratio means is that every rupee we pay in rent we generate 2.62 rupees of revenue. And this premium is being achieved because we are able to negotiate better in terms of rental price points with landlords which is being achieved because of the track record that we have been able to operate in these cities. And largely the competition here is fragmented. That is the Primary reason why we are able to achieve a better rent to revenue ratio here.
The client stickiness is also very high in these markets as 65% of our revenue comes from enterprise clients. The clients whom we have offered a build to suit solution. The average client lock in which is still left off with us is 3.5 years. The retention ratio is staggering 98% for us and the net churn rate which essentially means that we add more number of seats from our existing client than we are losing is negative 0.6%. The clients that are there with us beyond 300 seats have an average lock in of 37 months which would showcase a very strong cash flow for us in the coming months.
One third of our clients are multi city clients, meaning they would be with us not only in one city on one center, they would be with us in beyond one city or beyond one center. And they have been growing with us across the country and across the centers and we scale along with them. As I mentioned earlier, we are not just a workspace provider, we are a full stack enterprise infrastructure partner. Through our integrated platform we offer complete end to end managed office space solution which is the core revenue or the cash cow for us.
Then we have our design and build services which we offer it to our subsidiary wherein external clients takes our services of designing and building the entire office space. We provide end to end facility management services as well and through another subsidiary of sas Joy Solutions we offer technology solutions as well as under the same umbrella we provide recruitment as well as payroll services. So this makes us a complete full stack solution provider for global capability centers. GCCS are now an emerging consumers of IT real estate sector in India. Commerce and office space largely is consumed by global capability centers and we are building from a resource pool perspective, from a technology stack perspective a complete platform where we can offer them end to end solutions.
This is largely done to capture more wallet share from our existing client. Just to cite you an example, QX Global which started with us as the first client back in 2018 with a 500 seater space is still operating and working with us. We are the only preferred partner for that customer and operates with us in more than five cities. That is the strength of relationship that we’ve been able to build. Now let me walk you through some of our financial performance which we’ve been able to demonstrate because of this model. I’ll share the consolidated numbers.
First, our revenue from operations for the quarter three FY26 stood at 59.2 crores. On a comparable basis that is 19 percentage year on year for the nine month FY26 we achieved 166.7 crores as revenue which is a 53 percentage year on year growth. Just to help the people that are listening, last complete year we did 158 crores of revenue. We had to achieve 166.7 crores of revenue. Our EBITDA for nine month FY26 stood at 77.6 crores. There is an EBITDA margin of 46.1%. This again reflects the operating leverage as our mature centers are able to deliver higher utilization.
Our PBT for 9 month FY26 grew 173 percentage and we have been able to achieve 5.2 crores as our PBT and we have been consistently delivering positivity since last past two years at the PBT level on a standalone basis the numbers are much more stronger as our revenue grew 50 percentage year on year ending 124 crores in nine months FY26 our EBITDA margin increased to the highest level in the industry which is 61% up from 57.5% in the same period last year. Our cash EBIT for 9 month FY26 is 26.42 crores. I’ll throw some light on our subsidiaries with one of our design and build subsidiaries, the core strength of delivering projects faster and efficiently.
We delivered 38.8 crores of revenue in 9 month FY26 with 16.8% of EBITDA margin. Overall we delivered 19 projects across 7 lakh square feet of area with an average project size being 5000 square feet and an average project value being 1.25 crores. Our rent to revenue ratio has increased from 1.86 in the preceding same period of 9 month FY25 and we have achieved 2.62x of rent to revenue ratio. This showcases our operational efficiency in Tier 2 markets. As I share the numbers, I’ll give a quick glimpse of the entire industry as to why we are very bullish on this.
The Indian flexible office space market is going through a paradigm shift. It is currently valued at $6 billion today and it is expected to reach $11.4 billion by 2030. That is a growth of 14% on a CAGR basis. But the compelling story is the shift which is happening in this market. According to the recent industry research, Managed Workspaces, the category in which we operate has grown at 47% CAGR since 2018 which is outpacing the co working which is growing at 16% CAGRADE. GCCS as I touched upon earlier are the single biggest demand driver for flexible office space providers.
They contribute anywhere between 60 to 65% of the seat absorption annually. India today has 1850 GCCS which is up from 1285 GCCS in FY19. With approximately 100 to 115 GCCS being added upon every year. By 2030 the country expects that we would be serving 2200 GCCS and the employee count would be doubling and reaching to 2.8 million. Now this research was being conducted earlier. With the advent of safe harbor being announced in yesterday’s budget, I am certain that this number is going to grow exponentially. The GCC’s revenue has achieved a number of $105 billion. Today GCC consumes approximately 34% of India’s grade A office market.
GCCs kind of prefer managed office spaces because we are able to provide them long lease 10 years with customized solutions. They have a lower churn risk and they expect enterprise grade A infrastructure. All of that being served by head office space provider. They are not looking for hot desks. They do not want dedicated different spaces. They are looking at branded spaces that can scale along with their growth. And importantly VCCs are now looking beyond Metros to tap the talent pool at 16% than the national flexible average. Hiring in tier 2 cities is also growing 21% year on year hence.
Recent times we have met a lot of GCCs have started coming into tier 2 cities. They have grown from 5% in FY19 to 20% in FY25. And there are structural shifts. These are happening largely because the talent arbitrage is high. The cost arbitrage is extremely high. Today tier 2 cities offer 20 to 35 percentage cost advantage over Metros in terms of digitally skilled availability of professionals. Tier 2 cities has 800,000 people available and we have been witnessing as a country the budget. The national focus has also been into fulfilling the infrastructure gap in tier 2 cities.
Missions like smart cities, PM Gati Shakti, metros being set up and most importantly the connectivity between Tier 1 and Tier 2 cities has reduced the infrastructure gap and enforced the global employers to come to Tier two cities. This is precisely the way we have been waiting and building for since 2017. This quarter we have taken a decisive step to cement our leadership in this. I’ll share one of the largest deal that we have signed this quarter. We have signed an 8 lakh square feet of single managed office space contract in Ahmedabad which is on Amali Gopal Road.
That’s the same micro market wherein we have a current standing of 3 and a half lakh square feet. This is extremely large. Not only from a tier 2 city standard but across the country. This would be one of the single largest flex office space transaction that we have done. I’ll just share a few of the limelights of the deal here. It’s eight 10,000 square feet to be very precise it will have 8,500 seats. We are committing an investment of 100 crores across four years and occupancy of 85. It will start generating a revenue of 120 crores.
Now this deal is extremely significant for us because it falls under our development management model. It is a re engineered model. For the first time that’s being done in the flexible office space industry. We ourselves are putting in front of the shoes in the shoes of landowners which are non institutional in nature. Since we understand the quality of assets that are preferred by gccs. We are partnering with landowners, offering them our expertise and skill set, building their products or assets with our processes and helping them to build a grade A asset which would be leased by us and then offered as a complete solution to Global Capability Center.
These are purpose built buildings largely for global capability centers which would be operationally extremely effective. And we now onwards intend to scale this up rapidly by partnering with landowners across the country. By focusing more in tier 2 cities wherein the land ownership is fragmented. Landowners are non institutional in nature but are aspired to have enterprise demand. And that is where we would play a role. We would institutionalize that supply. We would bring in our expertise and focus on bringing Global Capability centers set up their offices by offering them payroll, recruitment and infrastructure under a single umbrella.
An update on the asset that we had on Amali Bhopal Road which was one of our largest in an operational stock. That 3.15 lakh square feet asset which is one of the largest in tier 2 cities will start operations from this quarter which is JFM quarter. We have already achieved 95% pre leasing even before going operational. This is technically not heard of because this size typically takes anywhere between nine to 12 months to reach a 95% occupancy. We have got 95%. We have achieved 95% occupancy even before going operational. This would add roughly 4,000 seats in the inventory and from a revenue standpoint it would add 2.75 crores to 3 crores on a month on month basis in the operational revenue that we will be achieving and the margins will be operationally positive in this center from day one.
Few of the marquee clients that we have onboarded here is Manubha and Shah which is a 5 decade old CA firm based out of headquartered in Ahmedabad. They are with us in more than five cities across the country. They are consolidating their entire inventory which was not with us in Ahmedabad and shifting their headquarters with us and they have taken 100,000 square feet of area. Another client is Walter P. Moore, a globally recognized design and structural consulting firm. They have taken almost full floor there which translates into 10,000 square feet of area. Then OpenXL TATVIT digital analytics is a few of the other clients marquee ones which have signed up with us.
This campus is located on Amlibopal Road wherein the additional 8 lakhs profit has been signed by us and we are establishing this corridor as a flagship for GCC destination in tier 2 cities in Western India. I’ll share my closing remarks now after the updates. We are India’s leading managed office space platform in tier 2 cities. We have built a deep moat in landlord relationship in bringing climb stickiness and built our operational efficiency. We have understood the unique dynamics that are required in this market. The landmark deal of 8 lakh square feet is not just a transaction for us but it is a playbook or a template which we will be replicating in other traditional real estate markets in other tier 2 cities and bringing in innovative solutions by a flexible operator across the country.
Our vision is clear to become the preferred destination and the preferred infrastructure partner for GCCs in tier 2 cities. Again sharing the quick understanding we are there across 28 centers in 12 cities, a strong balance sheet and an integrated platform offering build to suit workspaces, design and build along with allied services. This is a proven playbook that we have showcased as a testimony which we are going to replicate for our future exposure function in tier 2 cities. We strongly remain confident of delivering sustained growth and long term value for our shareholders. Thank you everyone for your continued support.
I’ll now open the floor for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. If you wish to withdraw yourself from the question queue, you may press STAR and two participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Shamit Ambit Capital Ambed Capital. Please go ahead.
Shamit
Yeah, hi Am I audible
Umesh Uttamchandani
yes, yes, we can hear you.
Shamit
Yeah, yeah, yeah. Hi. Thanks for the opportunity. So since I’m new to your business, I just wanted to, you know, understand a few things in depth. So what is your sourcing strategy? So is it like you take entire buildings from since you mentioned non institutional landlords or you just have a typical 25-15,000 sq ft center size in some of the properties sourced by the non institutional landlords. That is first. And what would your top 10 client contribute to your revenues? And I just wanted to know in your for your DNB division what kind of order visibility you have in hand.
Lastly, on the new managed office deal which you have signed in Ahmedabad for 8 15,000 square feet. So I wanted to know what is the average seat size per average seat size in that center?
Umesh Uttamchandani
Sure. Thank you so much sir. Thank you for interesting questions. I’ll start with the first one which is a sourcing strategy. So we have two approaches here. First is the city where we are not present. There we’ll set up anywhere between 25,000 to 40,000 square feet of area. We take up 25 to 40,000 square feet because our focus is to kind of set up a presence there. Now the dynamics in a newer city works differently and there are multiple stakeholders there. Our objective is to become a hyper local player there. So we would understand who our supplier is in terms of who our vendors are.
Basically understanding where we would bring in the furniture and fit outs. That’s first, understanding that we want to build in an ecosystem. Second, I want to understand the dynamics of where and which micro market is evolving and where it is heading towards. So that’s the second understanding that I would build. And third, I would want to build a strong pipeline of clients who are looking to take up future inventory or future seats or who can be my probable customers. So we would always start small in a newer city that is taking up 25 to 40,000 square feet of area two years later or probably one and a half years later, older in that ecosystem, in that city, once these metrics are established, we would start taking up larger inventory.
Now that inventory would be upcoming in nature. That is we would sign up an asset, let’s say one and a half years later, but the delivery of that asset would be a year down the line. So that gives us some time frame to market ourselves and by that time we would have some of the other client who would have committed us bigger inventory for that future supply that is coming up with us. So that is a modus apprentice. We would take up 25 to 40,000 square feet of area in a new city once we are established we would take up anywhere between 2 lakh to 3 lakh square feet in an older city.
So that’s the first answer on the sourcing Strategy. The top 10 clients, the question that you asked, the second one contributes today roughly 40% of our entire revenue. With respect to our design and build contribution, what we have done essentially is we have built a lot of processes since last three years and annualized if I see since last three years we have been growing 100% year on year. So back in 2022 we did 12 and a half crores of revenue. Then we were able to achieve 32 crores of revenue. This year we are on the verge of achieving almost 50 crores of revenue by this time frame and December we have closed 38 crores of revenue the average speed size.
So I think I’ll just touch upon little bit more on the design and build piece because more than contributing revenue it also adds lot of value in terms of the resources that we bring in. Just to give you a context on this, if I was a standalone company like they’ve explained, we do not have this capability of design build. I would not have the flexibility to hire senior resources in this. Today we have a team of hundred people comprising of project leads with 12 to 15 years of experience. Now I’m able to bear that cost because I’m sharing that cost along with the clients that I’m bringing in on a standalone basis.
So if I see from a lens of devex, we get the value of quality resources while the cost is not completely bound by us and that is being shared with the clients that are kind of coming on board. With this resources being added we are able to kind of reduce down our procurement cost. We are able to make our processes more stringent and effectively achieving an output of delivering offices on a timely basis. That is the ultimate outcome. Focusing on the last question of 8 lakhs. Perfect. To be very honest, that deal is very closer to our heart.
We have been kind of negotiating on that deal since last one quarter. It gives us a landmark positioning not only in the city but in the entire country because of the sheer size of the supply that we have taken up. The average desk size that we have witnessed within GCCS is anywhere between 60 to 65 per square feet. We are expecting roughly around 8,500 seats being consumed in that asset. On top of that the reality of market is. Loaded suit product for.
operator
I’m sorry to interrupt. Could you Please repeat again. Hello
Umesh Uttamchandani
from where did I break It’s.
operator
A few sentences back.
Umesh Uttamchandani
Am I audible now?
operator
Yeah.
Umesh Uttamchandani
Right. So I was saying about the 8 lakh square feet deal. We have been kind of negotiating and working on the numbers since last 1/4. And on a per seat size basic we have experienced anywhere between 60 to 65 per square feet is the consumption pattern by GCC. With this 8 lakh square feet we are looking at 8500 seats of inventory coming here. And all the common amenities that we typically plant in the asset consume lot of spaces and reduces the effectiveness of the layout. For us here we would be redesigning and keeping lot of common inventories, common features like we’ll put a game zone, we’ll have a box cricket, we’ll have a salon, we’ll have a daycare facility.
All incorporated in the design of the building that ultimately increase the efficiency of the layout that we can offer to our clients and in turn obviously increasing the revenue for us. I hope I was able to answer the question.
Shamit
And what kind of escalations in terms of rentals are you witnessing currently from both the landlord and tenant side?
Umesh Uttamchandani
Yeah, yeah. So on the supply side our escalations are anywhere between 4 percentage to 5 percentage on an annualized basis. But I’ll contextually help you understand this. Our rent to revenue ratio is 2.62. So let’s take an example. Our rentals are 40 rupees and our revenue that I am generating from the client is 110 rupees. So my escalation comes on 40 rupees of rental which is anywhere between 4 percentage to 5 percentage. While on the client side my escalations are on 110 rupees which is 5 percentage to 6 percentage. Okay. On a year, on year basis.
Shamit
Got it, thanks. If there are more questions, I’ll come back in the queue.
Umesh Uttamchandani
Sure, sure. Thank you.
operator
Thank you. Ladies and gentlemen, if you wish to ask a question you may press star and 1. The next question comes from the line of Jose, an individual investor. Please go ahead.
Unidentified Participant
Yeah, Am I audible to you sir?
Umesh Uttamchandani
Yeah, I can hear you sir.
Unidentified Participant
Yeah. So my first question is like what progress has been made on the center currently under the fit out during the. Quarter and when are they expected to become operational reserve?
Umesh Uttamchandani
I’m assuming you’re referring to this 3.15 lakh square feet asset. So we received the occupancy certificate or building usage permission in the month of December, that is the 27th of December is when we received the occupancy certificate. So technically that is when we started full fledged fit outs. We are expected to deliver the project in the next 15 to 20 days of time frame giving us a full fledged revenue towards the end of February and the first week of March.
Unidentified Participant
Okay, and my second question is what. Is the current occupancy level here? And how does it compare to the previous quarter and last year? And what is your outlook for the occupancy in the coming quarters in the last quarter?
Umesh Uttamchandani
So occupancy has always been north of 85 percentage historically as well. The reason why occupancy levels are higher in our case is because we are focusing being an enterprise or a managed office space provider. So we largely would have a customer on hand before we sign up a new supply. This quarter we have been able to achieve 88.4 percentage of occupancy number. But historically also the numbers have been north of 85 percentage largely as enterprise clients.
Unidentified Participant
Okay.
Umesh Uttamchandani
As well to kind of add a point on that part about our business is like are out of 8.83 million square foot, our 70 person centers are 100 occupied. So basically the occupancy is 88.4 percentage. But we consider that the center level profitability and center level occupancy out of 0.83 million square foot point 58 is my all the available areas are occupied 100%. So that considers as a mature center. So this is the good matrix you can evaluate.
Unidentified Participant
Okay. And I have one more question like how quickly do a new center particularly GCC led project become the ROCE acts from and what is the typical timeline to reach steady state return?
Umesh Uttamchandani
I’ll break this into two parts. Let’s say a center is of a size of less than 50,000 square feet of area. So that’s a traditional deal wherein the landlord would give us the space, we would invest in the fit outs and deliver a customized office to our enterprise clients. There are ROC is 36 months but in larger centers. But in the centers like 3.15 lakh square feet center there we are forecasting our ROCB to be around 27 months. And there are logical reasons to that. One of the biggest driver to achieve that outcome is the rent free period that we are able to achieve in larger assets.
So typically our entry period in a smaller asset is anywhere between three months to four months while in larger assets we are able to achieve eight months to 12 months of entry period. That is one primary driver. Second, we are able to bring in common areas from a percentage basis to an extremely low level. So let’s say if a 40,000 square feet area is being built, the common areas that I have to incorporate ranges between 22 percentage to 25% which includes my lounge, my meeting rooms, my conference rooms, my game area, my cafeteria. Now that percentage in a bigger area like 3 and a half lakh square feet of building drops to 16 percentage.
So technically giving us a saving of 5, 6% which increases the revenue for us.
Unidentified Participant
Okay. Okay. Yeah. Okay. Thank you sir. That’s all from my side. Okay. And all the best for the next.
Umesh Uttamchandani
Thank you so much.
operator
Participants, if you wish to ask a question, you may press star and 1. The next question comes from the line of Rohit Mehra with SK Securities. Please go ahead.
Rohit Mehra
Yeah. Thank you for the opportunity, sir. So my first question is related to the tier 2 cities. During the opening remarks you mentioned will be our target audience target henceforth like cities like Indore and Udaipur, Jaipur. So what is the strategic rationale for focus on tier 2 cities and how you addressable opportunity there?
Umesh Uttamchandani
Sure, sir. We are a belief that tier 2 cities would pave the next wave of growth as a country. If you have to grow from $4 trillion economy to $10 trillion economy the contribution from tier 2 cities like Ahmedabad, Jaipur, Indore, Baroda, Chandigarh would be way higher as compared to tier one cities. And that is significantly showcased by the policies as a country that we are putting across the infrastructure push. In fact he’s also been higher in tier 2 city and on ground. What we have been witnessing since last seven years is the fact that the talent pool available in these cities is much more loyal stays with you for a longer duration.
The arbitrage cost arbitrage of the talent is also higher here. So let’s say a react developer resource that is available in Bangalore Visa vis a react developer available cost of that resource in Baroda is at least 25 to 30% lower. And that gives an advantage for the last mile employer to consider tier 2 cities as the market to expand. That’s first reason. Second is cost arbitrage. The real estate cost is also significantly lower city like Mumbai which when we also have our center we have taken up a place at 120 rupees per square feet while a city like Jaipur is being taken up at 60 to 65 rupees per square feet.
So that’s the arbitrage that end employees are able to see and witness. And hence the transition or shift to tier 2 cities is happening faster.
Rohit Mehra
Got it. Got it. So so hence for the we will. See the margin expansion due to the tier tier 2 cities focus and all.
Umesh Uttamchandani
So we are currently also focusing on tier two cities. Our 70 percentage of our revenue comes from tier two cities.
Rohit Mehra
Yes. Okay. And how is the Ahmedabad Mega campus. And similar large DC DC L projects are funded?
Umesh Uttamchandani
How we are funding? That is the question.
Rohit Mehra
Yes.
Umesh Uttamchandani
So currently under the development management model we do not incur the cost of developing the asset. The capital investment from land to development is done by the landowner only. Our investment comes in paying security deposit and investing in the fit outs. That is where our investment lies. In fact for monitoring of the project we are that has now become a revenue stream for us. Since we support bringing our expertise to build a grade A asset. That quality is now helping us to generate revenue from the landlords.
Because we build in expertise to establish a grade A plus asset. So that knowledge, that understanding of global market is what we bring across the table as our contribution to monitor that asset. So landowners would pay us a certain fee to overlook development of that asset. While our task would be to then invest in fit outs, bring in GCCs, offer them a full fledged solution and then sell them across years.
Rohit Mehra
Okay, so thank you for a very. Elaborate answer that is from my side. For any question I will back in the queue. Thank you so much.
Umesh Uttamchandani
Thank you.
operator
Thank you. Ladies and gentlemen, if you wish to ask a question you may press star and 1. The next question comes from the line of Raja with that big digital analytics. Please go ahead.
Unidentified Participant
Yeah. Hi. Thank you for the opportunity. My question is with regards to the four new centers that we are which are under the pipeline currently. So I wanted to know like when are we expecting these four new centers. To get operational and what EBITDA margins can we expect from these centers?
Umesh Uttamchandani
Sure. So one of the largest center in that is Capital 1 which is 3.15 lakh square feet of area. We are expecting the revenues to start from end of February to early first couple of weeks of March. And as I mentioned that asset would be generating a faster roce for us at the center level. Typically we operate at 3035 percentage margin for the first few months. This center would be operating at 6065 percentage margin because of the rent free availability there and obviously because of the size scale that we have and we have been able to kind of bring in operational area much more effectively.
So the layout is kind of much more filler. That is one second center is in Pune. We have just got the position of that center. We’ll be starting the fit outs now. We are expecting that center to Go live in the month of April end or May first week. We already have 50% occupancy already achieved there even before the fit outs being started. So there we can expect anywhere between 35 to 40% of margins being achieved. And there’s one more center in Ahmedabad which is Million mines. We have started the fit outs there. We have reached to a stage when we are awaiting occupancy certificate from the developer.
Once that is achieved post that 25 days to 30 days will be operational there again we have a pre committed demand there. So we are expecting the revenue to kick start from April or May. We had signed that asset before time. So we have a good leverage on rentals. So there the margins would be 40, 45 percentage and asset would be GMDC asset. The development of that asset is currently ongoing. We are expecting to get the delivery of that asset in the month of September or October. And that asset from an operational perspective would be December, January 26th of January 27th.
Unidentified Participant
All right. Mega center that you mentioned in. So will that is it is it. Considered under signed pipeline or is it under fit out right now?
Umesh Uttamchandani
No, no. We have just signed that deal. It is a development management contract with the landowner. The entire building is yet to be developed. We have just onboarded India’s one of the largest and the prominent architects to start the designing process there.
Unidentified Participant
All right, sir. And the revenue guidance that you have provided for FY27 for 350 crore round. So can I expect this four centers. That you mentioned, Pune, Million Mile and. GMVC along with the capital one to kind of contribute majorly towards that revenue.
Umesh Uttamchandani
Yes, yes. So the the revenue forecast for 27 was done. This is the same line with the current centers that we already planned and achieved. The supply on hand are the same ones that going to be supporting us in achieving an outcome of 350 crores. It comprises of three revenue streams. One is our manager of space contribution. Second is our design and build unit. And third is our technology unit of SASJ Solutions.
Unidentified Participant
Understood sir. And that one last bookkeeping question. So in this quarter other expenses have. Increased by more than 100% for the standalone business. So any specific corporate expenses that has. Contributed to this increase or this is one of.
Umesh Uttamchandani
No, these are one off expenses. One time expenditures that were incurred post the IPO processes.
Unidentified Participant
Okay. That was approved in this quarter. Okay. All right. Thank you. Thank you sir for taking up my question. And all the best.
Umesh Uttamchandani
Thank you. Thank you so much.
operator
The next question comes from the line of Aniket Redkar, an individual investor Please go ahead.
Unidentified Participant
Good afternoon, sir.
Umesh Uttamchandani
Very good afternoon. Yeah, good afternoon sir.
Unidentified Participant
Yeah, yeah. So sir,
Umesh Uttamchandani
I am audible.
Unidentified Participant
Yes, yes, yes sir.
Umesh Uttamchandani
Sure.
Unidentified Participant
Yeah. So sir, in terms of our gcc, just wanted to understand how did GCC demand evolve on a virus basis and what basically the rationale behind this GCC across Ti2 market?
Umesh Uttamchandani
Sure. Well, largely, I mean if you understand India from a service standpoint, in early 2000s we were a BPO market for the group, right? So we used to be the back office for the for the world. So people used to set up their BPOs, call centers and that kind of helped them support their global growth. So from 2000 to 2010, if you see, we have been largely voice or chat support system for the group. 2010 onwards, the country evolved and we started attracting knowledge process outsourcing units. So lot of accounting units, lot of financial units, MLA units kind of were set up as back offices in the country.
With the advent of education and the exposure that we as a country got a lot of evolvement happen on the technology front. And the contribution at the global level from development perspective also increased. So 2017, 18 onwards we saw a lot of financial units setting up their back offices in India. And that is where it got unearthed that development can also be a strong backbone for them to set up in India rather than just voice chat or accounts. It can also be that we can build products, we can do R and D here and then support their global expansion.
That is all when it started. And today when we see lot of companies set up their development units, R and D units In India, roughly 18, 15 GCCs are operating in the country. Why we are kind of pursuing them primary reason is it is a full spectrum of solution. It increases a single contribution of revenue from a client rather than providing just an infrastructure, we can be a partner for them in growth which helps them understand how do they hire people, where do they hire people from? Where is that talent coming from? What is the design of workspace that can inspire people to stay for longer duration? These are the sort of conventions that can become a partner for our clients and not just a vendor client relationship.
And that is the advent. While we are focusing on GCC and categorically in tier 2 cities is the backbone or strength of us. As I shared earlier, I’m a firm believer that the next wave of growth in the country is coming from tier 2 cities and it is inevitable from the policies that we are witnessing today. Lot of infrastructure investments are going in tier 2 cities and to attract talent to reach out to the right Mindset and the infrastructure that is getting evolved. Lot of global companies you would see now coming to tier two cities with a greater push.
They were already coming in but it was not at the pace or speed tier ones were attracting. Probably next couple of years is when we will witness lot of global capability centers setting up their primary offices in tier two cities.
Unidentified Participant
Okay. Okay. And sir, one last question. What is the current, I mean how much is the market opportunity for us and how much we already targeted.
Umesh Uttamchandani
Market opportunity from just a managed office space perspective. You’re referring to GCC.
Unidentified Participant
From GCC perspective.
Umesh Uttamchandani
So today GCC I’ll come down top to bottom. Right. I mean today from a flexible office space market we are at a 5 billion dollar contribution. This is bound to reach around $11 billion in terms of market size. Now out of this 50 percentage is by GCC. Right. So we can easily evaluate that it is 6 to 7 billion dollars of revenue being contributed by GCC. Now out of all of that 21 percentage is being contributed by the flexible office.
Unidentified Participant
Okay.
Umesh Uttamchandani
And within that we hold 13 percentage market share in tier 2 cities.
Unidentified Participant
Okay. Okay.
Umesh Uttamchandani
That is the market size that we are probably looking to acquire.
Unidentified Participant
Good. Good. Thank you sir. This is from my side and all the best for the future.
Umesh Uttamchandani
Thank you so much.
operator
Thank you. Participants, if you wish to ask a question, you may press star N1. The next question comes from the line of Rohan Mehta, an individual investor. Please go ahead.
Unidentified Participant
Hello. Good afternoon sir. Thank you for the opportunity. So just you spoke about the geographical spread out that we have and you touched upon the rationale behind tier 2 cities. If you could also just give some color on what kind of with cities. If you’re looking at it in that particular way, which cities are giving us relatively higher revenue and seat capacity and where the growth has come in from in terms of operational area centers and seat capacity.
Umesh Uttamchandani
Sure. So we are currently From a Tier 2 standpoint, we are currently focused on Ahmedabad, Baroda, Rajkot, Surat, Gandhinagar. That’s. That’s the Gujarat belt. Then we are focusing on indoor in MP and in Rajasthan we are focusing on Jaipur and Udaipur. That is our current presence. We intending to add few more tier 2 cities which we are currently researching and analyzing as to what growth parameters can be done. I’ll share top level parts of that as well. Lucknow, Bhubaneswar, Coimbatore and Kochi. These are four other cities that we are currently evaluating from are from taking up a exposure there.
And we are speaking to few of our clients in understanding their growth. Metrics is there. Personally I feel cities like Ahmedabad, Baroda and Jaipur would be outliers for us and for the country as well because that is where majority of the infrastructure investment has already been done. Some of the marquee events like Commonwealth Games which has already been signed by Ahmedabad would probably shape as to how the city would grow and evolve into. And with the advent of that being already being done, I think we participating more in that growth would only help us in scale up faster.
Unidentified Participant
Got it, got it. So as of now, do you see, do you look at it in terms of a bifurcation between revenue coming in from Tier two versus Tier one?
Umesh Uttamchandani
Oh yeah. So I think we categorically want larger portion of our chunk coming to tier 2 cities. We are today our revenue contribution is 70, 30 and 70 percentage comes from tier 2 cities and tier 1 contributes 30 percentage going forward. Also our focus would be to continue with this share of revenues coming in from tier 2s and tier ones.
Unidentified Participant
Understood sir.
Umesh Uttamchandani
I’ll tell you the logics behind it.
Unidentified Participant
Yes, please go ahead.
Umesh Uttamchandani
Yeah, I’ll. I’ll explain the logic behind this for the interest of everybody. Since the the questions are focusing more on tier 2 cities. See in this sector the entry barriers is not that high. Right. There are a lot of lifestyle businesses as well opened up into this sector. What we are essentially doing is creating a virtual entry barrier in this tier 2 cities. Today I can proudly say that I’m one of the. I’m the largest operator in Ahmedabad, I’m the largest operator in Baroda, the largest operator in Jaipur. Now these statements are not mere statements.
These are not just headlines for our marketing perspective. These are on ground challenges that I’m throwing for my peers to enter in those cities. The kind of virtual entry barriers for the external or the tier one players to enter into the cities.
Unidentified Participant
Right, Right. Fair enough. So that makes sense. So would you say that tier one cities have saturated in terms of competition with so many players being there?
Umesh Uttamchandani
So that is also one of the reason why we kind of shying away from entering in a very big way in tier one cities. But having said that, we need to be mindful of the fact that today Bangalore, Delhi and Mumbai contributes largest consumption of real estate in. We can’t deny the reality on ground. Yes, it is saturated. Yes it is moving to tier two cities. But still they contribute the largest in terms of consumption of real estate. Hence we need to take a pie something from there. And also the decision makers are in this tier one cities.
So our presence in front of them becomes inevitable for us to win them in tier two cities.
Unidentified Participant
Fair enough. Also, if you could touch upon how much of growth comes in from new client additions versus you know, expansion of an existing client or the, you know, recurring revenue from an existing client. Do we, do you look at revenue from these two perspectives?
Umesh Uttamchandani
Yes. So I’ll share this contextually. QX Global, as I mentioned, has been with us since 2018. Retention of our client is one of the primary metrics for us in my investor deck. If you see we have bucketed them into three categories. Clients who are there consuming almost 100ft. So clients who are consuming between 100 to 300 seats and clients consuming more than 300 seats with us. I have a staggering 57 percentage continuation coming from 100 seats who are going to stay with us for more than two years. That’s a lock in period between 100 to 300 seats.
I have clients who are going to stay with us for almost three years of time frame and for more than 300 seats bucket, we have clients who are going to stay with us beyond three years locking and these are lock in duration that I’m saying agreement tenure is obviously at least 30 percentage higher than that, which means we have witnessed in the past that they’re going to continue with us at least till the agreement tenure. They do get a right to exit after the locking period as well, but that right has not yet been exercised in our case.
That is not the journey that we have seen yet. We are not seeing clients moving out of our pivot. So answering your question categorically, we have seen our existing clients contribute more in our growth story and contribute more to our revenue while we are kind of expanding rapidly. But having said that, 2022, 2023 were an outliers for us wherein lot of external demand also had to be brought in by us because we were expanding at a pace of more than 50 percentage.
Unidentified Participant
Right? Right, sir. So speaking of seats, what would be our current total capacity utilization in terms of occupancy of seats?
Umesh Uttamchandani
We are at 88 point some percentage being occupied by us, by the client. So out of 13 and a half thousand seats, that translates into some 12 odd thousand seats being consumed by the client. But I think to be very honest, from an industry parlance, I probably share this number because it is a metric that has been create created within the industry. Honestly, that is not how I prefer to get monitored. The number of seats or the number of clients that are kind of continuing with us after the locking and the quantum of revenue that is going to Stay with me for the next three years is the right metrics for me to get monitored or judged upon.
Because in the managed office space even while I was small at 100,000 or 200,000 square feet of area I was achieving more than 85 percentage 90 percentage occupancy level. Because I’m technically designing the space for a bigger client. My speculative take up is very less in nature. We work on a hedging sort of an environment wherein my lock in from the supply gets hedged by the lock in from the client. My exposure of lock in rental gets helped from the exposure of revenue that I’m supposed to receive from the client.
Unidentified Participant
Got it?
Umesh Uttamchandani
Did I miss it?
Unidentified Participant
Fair enough, sir. No, that. That makes a lot of sense. And you also answered another question that I would have asked about the KPIs that we should look at the key performance indicators. Yeah, so that is very helpful sir. Just. I’ll conclude with a question. If you could have any long term vision in terms of our revenues maybe two, three years down the line. And that’s all, sir.
Umesh Uttamchandani
Well, I’m a newly listed promoter. I’m not sure how much I’m supposed to share here. But as I’ve given an outlook in FY27 we are looking at the numbers of 350 crores being achieved across three revenue streams. Largely managed office space contributing the larger number then design and build becoming much more stronger, effective and across the country. And our SaaS Joe solution which is a technology unit wherein our recruitment, payroll and customized solutions for our enterprise clients kicking in these all three would be kind of contributing and helping us to achieve a revenue outlook of 350 crores by FY27.
Unidentified Participant
Got it. Got it. Okay sir, that was all from my side. Thank you. Thanks a lot for taking my questions. And all the best.
Umesh Uttamchandani
Thank you so much sir.
operator
Thank you. Ladies and gentlemen, if you wish to ask a question to the management you may press star and 1. The next question comes from the line of Anand Munda with my temple capital. Please go ahead.
Anant Mundra
Hello. Thank you for the opportunity. Sir. This might be slightly repetitive for you because I, I. My apologies. I joined the call late. But I just wanted to understand the economics of the development management model that you highlighted in the press release. And you missed a presentation with regards to the new 8 lakh square feet of deal that you won in Ahmedabad.
Umesh Uttamchandani
Sure sir. Thank you so much. And I’ll send a special thank you notes. This will help all the people that are listening to get a much more clarity on development management model. It is a new model that has been kind of financially re engineered by it.
So I’ll give a background on this. We did a development management model which is a prop co opco model as well for us wherein right from the land stage we partnered with the landowner, we told them that we want specs of this quality, we want to grade A plus asset. Something what is easily available accessible in tier one cities is not available in tier two cities. So for us the entire game that is being played is on the supply side and not the demand side across the country. If you see grade A plus assets enjoy north of 95 percentage of occupancy level.
Now if this statement is true, tier 2 cities does not have lot of grade A or A plus assets. And that is where we thought there’s a larger vacuum that can be solved by us. So we started approaching landowners, told them that there are a lot of skill sets that we have achieved in the last seven years which we can share it with you. Skill sets like understanding what is the ratio on a single floor plate, what can be the column width, what are the common amenities or features that can be added in the building and what are the specs on the electrical side.
How does the file design gets built in so that you can attract Fortune 500 clients? You know lot such pointers. There’s a, there’s a detailed questionnaire pointers that has been created for the landowner to get onboarded with us. Roughly around 190 odd points are being created by us as to how a supply is grade A or A plus. Now we told them that we will bring in expertise on the architectural side, on the MEPF side, on the structural side and on the PMC side. These are all four aspects of the development of the building which we will cover it from our side.
The contracting piece can be done by you if you want. We can bring in an external partner as well. But that remains a decision to be taken going down the line for doing this. The revenue that we will charge them is anywhere between 400 rupees to 600 rupees per square feet. So if I’m building, let’s say 100,000 square feet of area, I’ll charge them 100,000 rupees into on an average 500 rupees per square feet. That is the revenue that comes in my books. And the entire investment from a land stage is done by the landowner.
The development investment is incurred by the landowner. That can be done in the form of equity or debt that is in the prerogative of the land. So that is how it helps us. A, it creates a strong pipeline for off grade assets in tier 2 cities. B, it creates a stable source of revenue for us as well when we are just capitalizing on our existing resources and skill set and experience that we have acquired. Did I kind of answer that question, sir?
Anant Mundra
Yeah. So in the operations also then once the building is developed, is the operations also managed by us? Do we put the entire unit on rent hard sales? How does I mean for the development? How does it work?
Umesh Uttamchandani
Yes.
So I mean, one of the primary aspect of signing a development management model is that we want to have the operational side of the business because that is the core bread and butter for us. We wanted grade A supply to come in at the time at a, at a micro market where we want, which was not coming in effectively. And hence this BM model will help us achieve that. So operational agreement is mandatory. If that is true, if that selection is done by our research team, then only we go ahead and sign the DM model.
Anant Mundra
Okay. Okay. Okay. And then once the. So then, then it’s the straight lease model that, that takes up like do we pay a pitch rental every month? The normal contract?
Umesh Uttamchandani
Yeah.
Anant Mundra
Okay. Okay,
Umesh Uttamchandani
t hat’s correct. That’s correct.
Anant Mundra
So at the, at the development stage, there’s an additional 400 to 600 square feet per square feet that we charge to the client for our expertise in designing the building and post that. It’s a normal state, please model that, that. Okay,
Umesh Uttamchandani
that kicks it. That’s. That’s right.
Anant Mundra
Okay, okay. But here the capex is done by the, the only difference is that the capex is being done carried on, on the books of the.
The developer
Umesh Uttamchandani
, the. The landowner. Yes.
Anant Mundra
Okay. Okay, understood. Thank you.
Umesh Uttamchandani
Typically looking at landowners rather than developers because developers would preferably not get into agreement with us. Landowners are the ones who would prefer to get into arrangement with us because those are the ones who would look at long term rental revenues on an ongoing basis.
Anant Mundra
Understood. Thank you. Thank you. Thank you.
Umesh Uttamchandani
Thank you so much, sir.
operator
Thank you. As there are no further questions from the participants, I would now like to hand the conference over to Mr. Umesh for closing comments.
Umesh Uttamchandani
Thank you so much everybody for coming on the call. We value and respect the time that you have given to understand our business. We look forward to your continued support going down the line. Thank you so much.
operator
Thank you. On behalf of Dev Accelerator limited. That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.