OYO IPO - 7 Things to Know About
In a market where digital IPOs have been the rage, one more Unicorn name from India is expected to hit the IPO market soon. OYO requires no introduction. Anybody who has tried to book hotel rooms at reasonable rates at short notice have used OYO at some point. OYO is planning a massive IPO in the Indian market.
Here are 7 things to know about OYO IPO:-
1) OYO Rooms is owned by Oravel Stays Limited, which will actually come out with the public issue. However, it is better known by the brand it represents i.e. OYO Rooms and is an online syndicator of hotel rooms and short stay homes.
2) The total IPO size is expected to be Rs.8,430 crore. This will comprise of a fresh issue of Rs.7,000 crore and an offer for sale of Rs.1,430 crore. SVF India Holdings, a unit of Softbank Vision Fund, will be tendering shares worth Rs.1,329 crore in the OFS.
3) The promoter of OYO Rooms, Ritesh Agarwal, holds 24.94% stake in the holding company of OYO, Oravel Stays. However, Ritesh will not be offering any of his shares as part of the OFS and will continue to hold his entire stake.
4) Like most digital start-ups, OYO Rooms has also been making losses each year since its inception in 2012. In FY21, OYO reported net loss of Rs.3,942 crore. In FY20, OYO net losses were much higher at Rs.13,123 crore.
5) The Rs.7,000 crore fresh issue proceeds will be used by OYO Rooms to reduce its debt and also for organic and inorganic expansion of its business. As of March 2021, OYO has consolidated debt of Rs.4,891 crore.
6) The OYO model is largely based on the US based Airbnb model. It was Airbnb that pioneered the concept of Bed and Breakfast (BNB) rooms sold over the net. Airbnb is today valued at more than most of the large hotel chains.
7) OYO currently operates over 157,000 storefronts (hotels and homes) spread across 35 countries. Its biggest concentration is in India, Europe, Malaysia and Indonesia. The OYO is the second largest loyalty franchise in India after Inter Miles of Jet Airways.
OYO has filed the DRHP with SEBI and regulatory approval is awaited.
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