Oyo IPO Date, Price, Review & Analysis

ORAVEL STAYS LIMITED (OYO) IPO

OYO is a global platform with the world’s leading chains of hotels and homes listed on its platform.  It empowers entrepreneurs and small businesses with hotels and homes by providing full-stack technology that increases earnings and eases operations, bringing affordable and trusted accommodation that guests can book instantly.

More than 1,57,000 storefronts (Hotels & homes) are using its tech globally to maximize revenue, build an online presence across channels, reach more guests & optimize the experience, and for hassle-free operations.

As of March 2021, it has a presence in more than 35 countries, including India, China, Malaysia, Nepal, Indonesia, UAE etc.

Ritesh Agrawal started OYO rooms in 2012. Initially, it was a platform for booking short duration hotels. Now it provides facilities for booking vacation homes, corporate travel, co-working space, premium luxury hotels and other segments. OYO app is very popular globally, and it stands 3rd in a mobile travel app as of 2020.

Competitive advantages

• Scaled footprint with leadership in Core Growth Markets.
• Full-stack technology platform driving a strong value proposition for its Patrons and Customers.
• High degree of engagement with its Patron and Customer community.
• Virtuous flywheel driven by strong network effects.
• Strong and trusted consumer brand.
• Inherent financial strength with strong unit economics.
• Strong leadership team with deep experience.

Weaknesses & Negatives

• The company is not profitable yet. As it is in growth mode, it will take years to achieve profitability.
• Its industry is competitive. Many players operate in the same market with similar business models like MakeMyTrip, Trivago, Treebo, Lemontree, even IRCTC. So, competition is enormous here for Oyo.
• SoftBank holds 46.6% of the stake in Oyo rooms. As it is a foreign entity, there is always a chance of a regulatory issue.
• Oyo functions in the hospitality industry where customer satisfaction is of utmost importance, and it isn’t easy to please every customer. Unfortunately, due to small mistakes, customer dissatisfaction and disputes arise, impacting the company’s branding.
• Ritesh Agarwal, the founder, is the main driving force behind Oyo, so the company has critical man risk. If, for any reason, Ritesh Agarwal decides not to continue with Oyo rooms, it will negatively affect the company.

Objects of the offer

• Prepayment or repayment of loans availed by some of its subsidiaries.
• Funding organic and inorganic growth activities like expanding storefront base, technology platform and possible acquisitions.
• To meet general corporate purposes.

Financials of Oyo

Oyo IPO Issue Details

Oyo IPO Bid Details

Source: Oravel Stays Limited DRHP

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