India’s homegrown hospitality giant OYO Hotels & Homes, backed by SoftBank, has received board approval to move forward with a fresh IPO filing. According to reports, the company is targeting a November 2025 DRHP submission. It will be the third attempt of Oyo for a public listing.
Oyo IPO Journey: Two Withdrawals, One More Shot
OYO’s road to Dalal Street has been anything but smooth. The company first filed in 2021, aiming to raise INR 8,430 crore, but withdrew in 2022 amid regulatory pushback. A second attempt in 2023, via SEBI’s confidential route, was also pulled back in 2024 due to unfavourable market conditions and demands from majority shareholder SoftBank for stronger earnings.
Now, with improving fundamentals and clearer profitability, OYO is positioning itself for what could be one of the biggest IPOs in India’s tech-driven hospitality sector.
Financial Turnaround: From Losses to Profits
OYO’s financials suggest a company entering a new phase:
- FY25 EBITDA: ~INR 1,100 crore
- Net Profit FY25: ~INR 623 crore, marking a significant turnaround
- EBITDA Margin: 17–18% on revenues
- Projected FY26: Profit after tax of INR 1,100 crore; EBITDA of INR 2,000 crore
Global operations remain OYO’s backbone, with 78% of revenues generated outside India, spanning the US, Europe, Southeast Asia, and the Middle East. Its network now includes 22,700 hotels and 1,19,000 homes across 35+ countries.
Oyo IPO Approval: Valuation Debate
Banking partners and institutional investors are said to be discussing a valuation of USD 7–8 billion (~INR 66,000 crore). This pegs the IPO price band around INR 70 per share, or roughly 25–30 times EBITDA.
Yet, analysts remain divided. OYO’s private equity valuation has fluctuated wildly — from USD 9.6 billion in 2021 to lows of USD 2.3–3.8 billion in 2024 during private rounds. Critics argue the multiples are steep compared to listed hotel chains, while supporters see justified optimism in OYO’s international assets, tech-led model, and debt reduction efforts.
Strategic Moves: Acquisitions, Debt Buybacks, Premium Expansion
In preparation for a stronger listing narrative, OYO has executed key moves:
- Debt Reduction: Bought back INR 1,650 crore of debt, saving an estimated INR 125–145 crore annually.
- Acquisitions: Purchased Motel 6 and Studio 6 (US) and Checkmyguest (France), expected to add over INR 2,000 crore in EBITDA.
- Premium Segments: Expanded into high-end offerings like SUNDAY, Palette, and Townhouse O, along with Townhouse Cafe QSRs, boosting margins.
Leadership and Governance: A Strengthening Board
OYO’s board boasts global heavyweights:
- Ritesh Agarwal – Founder & CEO, India’s startup poster boy and now a Shark Tank India judge.
- Troy Alstead – Former COO, Starbucks.
- Aditya Ghosh – Former Indigo Airlines co-founder.
- William Steve Albrecht – Risk management expert.
- Bejul Somaia – Lightspeed Venture Partners.
- Sumer Juneja – SoftBank managing partner.
Recent leadership changes include Sonal Sinha, elevated to CEO of G6 Hospitality (Motel 6 parent), and Rakesh Kumar stepping in as CFO and General Counsel.
Risks Ahead
Despite the positivity, here are the challenges:
- Legal Issues: INR 168.8 crore CCI penalty and GST-related cases.
- High Finance Costs: FY24 finance expenses INR 843.82 crore; currency fluctuations can eat into profits.
- Subsidiary Woes: Several group companies have eroded net worth and are dependent on parent support.
- Governance Issues: Internal audit flagged privileged access in accounting systems.
Can OYO Succeed?
For OYO, this IPO is not just about raising money — it’s about proving its model after all the turmoil. From being a cash-burning startup to now making profits, OYO wants to be seen as a tech-enabled global hospitality giant.
Will investors buy into its story at a USD 7–8 billion valuation? That will depend on sustained profitability, successful integration of acquisitions and navigating regulatory and financial hurdles.
OYO IPO filing expected in November 2025, the next few months will decide if OYO finally makes it to the public market or gets delayed again.
Hospitality Sector IPOs in the Past 7 Years
Over the past seven years, the hotel industry has seen eight IPOs hit the market, delivering a modest average return of 11.66%. Only two managed to shine on listing day—Apeejay Surrendra Park Hotels and Lemon Tree Hotels—posting strong debuts with returns of 31.32% and 27.95% respectively, while Brigade Hotel Ventures entered the bourses on a disappointing note with a negative listing. Yet, the long-term picture tells a different story. Chalet Hotels and Lemon Tree Hotels have since emerged as multibaggers, rewarding investors handsomely with gains of 263.88% and 195.50%.
Meanwhile, other players such as Samhi Hotels and Ventive Hospitality have delivered healthy double-digit returns, contrasting sharply with laggards like Juniper Hotels and Schloss Bangalore, which remain deep in the red.
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