Oyo Hotels, the once-high-flying Indian startup, is resuming preparations for a stock market debut as early as January 2023 as rebound in tourism helped it minimise losses, news agency Bloomberg reported citing people aware of the matter.
Executives at Oyo said they were encouraged by a rise in demand and were working internally towards a January IPO. They wished to remain anonymous since the discussions were private, the report said.
Oyo Hotels, the once-high-flying Indian startup, is resuming preparations for a stock market debut as early as January 2023 as rebound in tourism helped it minimise losses, news agency Bloomberg reported citing people aware of the matter.
According to those with knowledge of the situation, the hotel booking company filed new documents with market regulator Sebi on Monday and is now planning for an IPO as early as 2023, assuming that stock market continues to hold up and the country's economic situation improves.
Executives at Oyo said they were encouraged by a rise in demand and were working internally towards a January IPO. They wished to remain anonymous since the discussions were private, the report said.
Oyo had submitted draft IPO papers in 2021, but the firm shelved the listing plan early this year as a result of the prolonged epidemic, which hampered its growth and made it necessary for it to lay off thousands of employees. It released its most recent financial information on Monday in an IPO filing supplement. The figures showed smaller losses and an increase in sales for the fiscal year that ended in March 2022 and the three months that followed.
The firm is currently concentrating on four key regions: Europe, where it handles holiday properties, India, Malaysia, and Indonesia. According to one of the persons, it has scaled back activities in regions it once saw as essential, such the US and China, where its workforce now numbers in the single digits.
After a string of failures in their attempts to transform the hotel and lodging business, Oyo and its founder Ritesh Agarwal are now attempting to pull off a successful IPO. Masayoshi Son, the founder of SoftBank Group Corp., backed the Gurgaon-based firm with enthusiasm and support early on. The Japanese conglomerate currently owns around 47 per cent of the company. Agarwal, 28, is the owner of around one third.
The resurrected listing proposal further demonstrates how India's stock market is defying the worldwide trend of falling tech equities. The tech-heavy Nasdaq index has fallen 27 per cent this year as a result of accelerating inflation, ongoing Covid-19 infections, and the situation in Ukraine. The benchmark NSE Nifty 50 index is currently up 1 per cent.
For the year ending in March 2022, Oyo reported a loss of Rs 1,890 crore, almost halving from the prior 12 months. The values were revised from previously unreleased data and incorporated in the IPO document supplement that its bankers made available.
For the fiscal year ending in March 2022, revenue from contracts with consumers grew 21 per cent to Rs 4,780 crore, with travel picking up as the epidemic receded. The revenue still falls far short of the Rs 13,170 crore that were projected for fiscal 2020 before the coronavirus started having its full impact.
The Draft Red Herring Prospectus (DRHP) was submitted by Oyo in September last year for a $1.1 billion initial public offering (IPO), but 12 months have passed since then without the listing being approved. It requested to file further paperwork earlier this year and received regulatory approval for the move. The startup's most recent valuation, according to analyst CB Insights, was $9 billion.
Agarwal, who was 19 at the time, founded Oyo in 2013 after quitting college to traverse the nation. The business started working with tiny hotels to standardise everything from bed linen to bathroom equipment for showers, which it then branded with its eye-catching red and white Oyo logo.
It rapidly expanded across Southeast Asia, China, Europe, and the US with the support of well-known investors like SoftBank and Lightspeed Venture Partners, signing on hotel partners with guarantees of profits. Founder Agarwal formerly had the lofty goal of becoming the top operator of branded stays in the entire world.