After the markets regulator returned them on December 30, hospitality upstart Oyo announced that it would resubmit its draught initial public offering (IPO) documents by mid-February.
The goal of an early 2023 IPO was delayed because Oravel Stays Ltd, which manages Oyo, was asked to resubmit the draught red herring prospectus with modifications and revisions. “We are working on updating all key sections simultaneously. We are keen on refiling the DRHP by the middle of February,” an Oyo spokesperson said, without commenting on when it expects to get Sebi’s approval.
Oyo first submitted its draught papers to the Securities and Exchange Board of India (Sebi) in September 2021 for issuance of 8,430 crores, which would be split between a secondary share sale for 1,430 crores and a primary capital raise for roughly 7,000 crores.
According to VCCircle, it wrote to the Sebi in May 2022 requesting permission to update its financial statements and postpone its first public offering (IPO) past September.
The corporation had a valuation of roughly $10 billion when it filed its DRHP, which it later reduced to $7-8 billion.
The business filed an amendment to its initial DRHP in September, one year after submitting it, following cost-cutting measures and a rebound in travel-reduced losses. In November, it submitted a second addendum, informing Sebi and potential investors of the financial results of the first half of FY23.
The regulator then instructed the business to file the DRHP again after updating all pertinent parts, including risk factors, KPIs, pending litigation, and the offer’s justification. “The disclosures contained in present DRHP do not take into account the material changes/disclosures arising from updated financial statements as filed through addendums,” Sebi said.
Oyo’s private market valuation, meanwhile, dropped to about $6.5 billion after SoftBank reportedly reduced the company’s value in its books by more than 20%.
The business is now working to hasten the IPO procedure. The refiling might take up to two to three months, according to an earlier statement.
In contrast to its loss of 280 crores the year before, Oyo declared a profit of 63 crores for the first half of FY23. From a year earlier, its revenues for the six months ending on September 30 increased by 24% to 2,905 crores.
In December, the business halted a few initiatives and combined its product and technical teams in preparation for the IPO. It announced plans to fire 600 executives from its technical and product divisions as part of the restructuring.
Ritesh Agarwal established the Gurugram-based business in 2012. It has reduced activities in areas it formerly regarded as essential, such as the US and China, and now concentrates on four key regions: India, Malaysia, Indonesia, and Europe, where it handles holiday properties.
