SoftBank-backed hospitality giant Oyo has reported a remarkable financial performance for the first quarter, with profits more than doubling and revenue showing significant growth.

Profit and Revenue Surge

Oyo achieved a profit after tax (PAT) of over Rs 200 crore in Q1, marking a substantial increase from Rs 87 crore in the same quarter of the previous fiscal year. This represents a more than 100% year-on-year growth in profitability.

The company's revenue also saw a robust increase, growing by 47% to reach Rs 2,019.00 crore, up from Rs 1,371.00 crore in Q1 of the previous year.

Impressive Gross Booking Value Growth

One of the most striking aspects of Oyo's performance was the surge in Gross Booking Value (GBV). The company reported a GBV of Rs 7,227.00 crore for Q1, representing a staggering 144% increase from Rs 2,966.00 crore in the corresponding period of the previous year.

Drivers of Growth

Oyo attributes its strong performance to several factors:

• Increased hotel openings
• Double-digit same-store growth
• Premiumization strategy
• Improved room utilization

The company's premium brands, including Townhouse and Sunday hotels, played a significant role in driving growth. This was complemented by disciplined cost management practices.

Full Year Performance

For the entire previous fiscal year, Oyo reported impressive figures:

Corporate Actions and Future Plans

Oyo has initiated several corporate actions to capitalize on its growth momentum:

1. Bonus Shares: The company has sought shareholder approval for a 1:1 bonus share issuance.
2. Authorized Share Capital: A proposal to double the authorized share capital to Rs 24,31,13,59,300 has been put forward.
3. ESOP Expansion: Oyo plans to increase its ESOP pool by 8.8 crore stock options.

Management Commentary

Ritesh Agarwal, the founder of Oyo, expressed satisfaction with the company's performance, highlighting two consecutive years of PAT profits. He emphasized the company's commitment to scaling profitably by enhancing customer experience and expanding premium offerings.

Looking Ahead

With its strong financial performance and strategic initiatives, Oyo appears well-positioned for continued growth. The company's focus on premium offerings and improved operational efficiency seems to be paying off, as reflected in its impressive Q1 results.

As Oyo continues to evolve in the competitive hospitality sector, investors and industry observers will be keenly watching its ability to maintain this growth trajectory and profitability in the coming quarters.

Hospitality chain Oyo is set to make its third attempt at going public, following board approval for a fresh IPO filing. This move comes on the heels of the company's impressive financial performance, with EBITDA reaching approximately Rs 1,100.00 crore.

Previous IPO Attempts

Oyo's journey to the public markets has been marked by two previous attempts. The company filed draft prospectuses in 2021 and 2023 but subsequently withdrew both applications. The 2021 attempt was particularly ambitious, targeting an IPO size of Rs 8,430.00 crore.

Financial Projections

CEO Ritesh Agarwal has set optimistic targets for the company's future performance:

These projections suggest a strong growth trajectory and improved profitability for the hospitality chain.

Preparations for the IPO

In preparation for this third attempt, Oyo has taken several key steps:

1. Investment Bank Meetings: The company has approached five investment banks, including Goldman Sachs, Citi, and Jefferies, for meetings with key shareholder SoftBank.

2. Board Composition: Oyo's board includes notable figures such as Troy Alstead, W Steve Albrecht, Aditya Ghosh, SoftBank's Sumer Juneja, and Lightspeed's Bejul Somaia.

3. Filing Focus: The upcoming filing is expected to highlight Oyo's first-quarter financial performance and operational improvements.

Market Sentiment

Senior bankers are reportedly optimistic about Oyo's improved long-term outlook. This positive sentiment, coupled with the company's strong financial performance, could potentially create a more favorable environment for the IPO compared to previous attempts.

Looking Ahead

As Oyo prepares for its third IPO attempt, investors and industry observers will be closely watching the company's financial performance and market conditions. The success of this attempt could mark a significant milestone for the hospitality chain and potentially influence the broader Indian startup ecosystem.