OYO records its first year in the green in FY24 with Rs 100 crore net profit

Fitch Ratings upgraded the rating of OYO's parent firm, Oravel Stays, citing the hospitality company's enhanced financial profile

Online hotel aggregator OYO has recorded its first profitable financial year in 2023-24, with net profit reaching nearly Rs 100 crore, according to founder Ritesh Agarwal.

In a post on X (formerly Twitter), he claimed that the company was in robust financial health, marked by eight consecutive quarters of positive EBITDA and a cash balance of approximately Rs 1,000 crore.

Although these are a provisional numbers, Agarwal said that the audited financials will likely be close to these figures.

Meanwhile, the company is reportedly seeking to raise as much as $80-90 million from family offices at a $3 billion to $4 billion valuation, which is 70 percent lower than the peak of $10 billion that it had touched in 2019.

Earlier this month, the hospitality unicorn formally withdrawn its IPO application for the second time as it looks to refinance a $450 million loan repayment and raise additional money via fresh issue of shares.

Sources close to the developments said that OYO has clocked an adjusted EBITDA of Rs 888 crore ($107 million) in FY24, compared to Rs 274 crore ($ 33 million) in FY23.

"In FY24, the company added about 5,000 hotels and 6,000 homes globally. The gross booking value (GBV) per storefront per month for hotels stood at Rs 3.32 lakh ($4,000). The travel tech platform's gross margins improved in FY24, reaching Rs 2,508 crore ($302 million), up from Rs 2,350 crore ($283 million) in FY23, and operating costs also improved, decreasing from 19 percent of GBV in FY23 to 14 percent of GBV in FY24," said a person in the know.

In his post on X, the OYO founder expressed confidence in the company's growth prospects not only in India, but also in key international markets such as the Scandinavian region, Southeast Asia, the US, and the UK.

Additionally, Agarwal pointed to Fitch Ratings' recognition of OYO's improved performance and strong cash flows, which led the global credit rating firm to upgrade its rating of OYO's parent company, Oravel Stays. He emphasized the emerging travel trends and projected an even more promising fiscal year ahead.

Earlier this week, Fitch Ratings upgraded the credit rating of Oravel Stays, citing the hospitality company's strengthened financial profile. In FY24, OYO expanded its portfolio by adding 5,000 hotels and 6,000 homes globally. The company reported a PAT of Rs 99.6 crore and an adjusted EBITDA of Rs 888 crore for the fiscal year.