Athira Sethu
Kochi, 20 January 2025
Hospitality startup Oyo is getting set to file for its Initial Public Offering by the end of this quarter, marking its third attempt to go public. Founder Ritesh Agarwal, through the restructuring of the company’s shareholding, is leading the process of supporting the IPO plans, a report in the Economic Times said.
Early investors include Lightspeed Venture Partners, among others, looking to sell their stakes in the company. And then there are those who sold stakes, for example, Peak XV Partners sold some $80-90 million. Agarwal has also negotiated debt financing arrangements related to this IPO. Insider sources indicate the filing could actually be earlier than the end of the first quarter.
A series of new family offices have entered the fray seeking returns when Oyo goes public. The two largest shareholders along with Agarwal are the SoftBank conglomerate and many high-net-worth family offices are likely to own large stakes ahead of the filing for the Oyo IPO. Agarwal, through his investment, could stake an even bigger claim.
Oyo first attempted to go public in 2021, but its application was returned by regulators. A revised application for a smaller IPO was withdrawn in 2023, and Oyo opted for private funding instead. The company recently raised Rs 1,457 crore, valuing it at $2.4 billion.
Oyo’s valuation has fluctuated, peaking at $9 billion in 2021 and dropping to $4 billion today, reflecting efforts to focus on sustainable growth. SoftBank, Oyo’s largest investor, had previously valued the company at $2.7 billion.
The IPO size will be less than $1 billion, although those details are still to be finalised. Oyo’s improvement in financials supports this step. For the first time in FY24, it reported a profit Rs 229 crore. Now, for Q1FY25, the profits have risen by Rs 132 crores.
Expansion in India, Southeast Asia, and the U.S., along with investments in Europe, has contributed to this growth. Oyo’s acquisition of G6 Hospitality in the U.S. is expected to add over Rs 630 crore to earnings, with overall EBITDA projected to exceed Rs 2,000 crore by FY26.
Oyo’s IPO plans align with a broader trend of startups entering public markets, following a wave of new-age firms that went public in 2024.
