Oyo parent in talks to raise $200 mn at a valuation of $4.5-5 bn: Report

Oyo parent in preliminary talks to raise $200 mn at valuation of $4.5bn - $5bn: Report

Oravel Stays, which runs the global travel and living firm Oyo, has started talks to raise $200 million in a primary funding round, Business Standard reported.

The company is seeking to close the funding at a valuation of $4.5-5 billion, above its last valuation of $2.4 billion, but still far from $10 billion, the report added. It aims to support its acquisition of G6 Hospitality, the owner of Motel 6, a popular budget hotel chain in the US.

The company is in talks with offshore institutional investors and private Indian investors to raise fresh funds, the report further stated.

Moneycontrol couldn't independently verify the report.

Private investors include InCred Wealth, J&A Partners, the Mankind Pharma family office, and ASK Financial Holdings, which pegged the company at $2.4 billion.

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Oyo declined to comment, the publication said.

The Softbank-backed company raised Rs 1,457 crore from a consortium of investors in August. The IPO-bound unicorn has raised nearly Rs 1,040 crore in a Series G funding round after raising Rs 416.85 crore in the same series.

According to different documents accessed by news agency PTI, the additional equity issuance was approved by 99.99 percent shareholders in an EGM held on August 8.

OYO clocked its first-ever profit after tax (PAT) of Rs 229 crore for FY24, a significant turnaround from the Rs 1,286 crore loss it had posted the previous year. This turnaround was fuelled by stringent cost cuts and a Rs 453-crore boost from exceptional items, including a Rs 240-crore fair value gain from acquiring Oyo Hotels Cayman and a Rs 249-crore reversal of financial liability.

The profit follows eight consecutive quarters of positive Adjusted EBITDA, which grew 215 percent to Rs 877 crore in FY24 from Rs 277 crore a year back.

OYO's inventory grew from 12,938 in FY23 to 18,103 as on FY24.