OYO's losses shrink to Rs 3,929 crore during FY21

IPO-bound hospitality firm OYO's losses shrunk to Rs 3,929 crore during the financial year ending March 2021 against a massive Rs 12,799 crore as compared to the previous fiscal, according to the draft red herring prospectus (DRHP) filed on October 1.

The sharp decline in the losses can be attributed to the corrective measures the company took including restricting its focus on key global markets and multiple rounds of lay-offs and furloughs during the last year following the deadly pandemic which heavily impacted the travel and tourism industry.

Interestingly the company had last published its annual result in 2019 when its loss stood at Rs 2,525 crore and total income Rs 6,518 crore.

During the financial year ending March 2021, the total income too took a sharp plunge to Rs 4,157 crore from Rs 1,3413 crore. This could well be attributed to the rationalization efforts taken by the company in the year preceding the first wave of the pandemic.

Even the expenses incurred by OYO dipped to Rs 6,936 crore during the period under review as compared to a whopping Rs 22,800 crore.

The two heads which made maximum contribution to this decline are operating and employee benefit expenses.

While the operating expenses went down to Rs 2,773 crore, the company spent just Rs 1,742 in employee benefit expenses.

During 2020, the two stood at Rs  9,738 crore and Rs  4,765 crore respectively.

On October 1, OYO filed its draft documents to raise $1.2 billion (Rs 8,430 crore) via an initial public offering (IPO) on the Indian Stock Exchanges.

It consists 83 percent of fresh issue worth Rs 7,000 crore and 17 percent offer for sale (OFS) worth Rs 1,430 crore.

As reported by Moneycontrol, first founder Ritesh Agarwal will not be offloading any stake in the IPO. He owns around 34 percent stake in OYO.