Creatures X and Y, smoke grenade, area of location

[Aerotime]

If creature X on its turn, uses its last action to throw a smoke grenade in between itself and creature Y, does creature Y start its turn observing creature X through the area effect of the smoke grenade or does creature Y need to use a search action to pinpoint creature X to either gain “aware of location” with in precise sense or observe if creature Y has an ability to ignore concealment (in ex. a targeting computer)?

[Xenocrat]

Concealment (as opposed to total concealment) only lets you choose to attempt Stealth to hide. They can see you just fine until you do that. There is immediately a 20% miss chance.