JP Morgan provides Rs 200 cr credit facility to Oyo: Report

JP Morgan has provided a credit facility of Rs 200 crore to Oyo, aimed at fueling the expansion of Oyo's Accelerator Programme, The Economic Times reported quoting sources. In March last year, Oyo introduced its Accelerator Programme to support 50 first generation hoteliers. It aspired to boost these hoteliers' portfolio expansion through the surge in business and leisure travel.

As of now, Oyo's Accelerator Programme assists over 700 hotels and more than 85 small and first-generation hoteliers countrywide, the report said. The programme is open to hotel owners with five or more operating hotels. Under the programme, Oyo seeks to help them achieve long-term profitability and increased earnings through mentorship, access to technology, and financial support, among other things.

Ritesh Agarwal, the founder of Oyo, had revealed last month that the company's profit after tax (PAT) for the third quarter of the financial year 2024 doubled sequentially to Rs 30 crore. The second quarter of this fiscal year saw the company's maiden profitable quarter with over Rs 16 crore in PAT.

Agarwal stated that the company's net profit will likely continue to grow in the future quarters due to enhanced customer confidence, improved experience and favourable market conditions.

The company reportedly expects to surpass its earlier projection of Rs 800 crore and post an adjusted Ebitda of Rs 1000 crore this fiscal year, Agarwal informed the employees. Oyo's revenue grew by 10% year-on-year, and the number of hotels on their platform rose by 27% in the third quarter, he added.

In November 2023, Oyo completed a debt buyback of Rs 1620 crore involving the repurchase of 30% of Oyo's outstanding term loan B (TLB) due in June 2026. Hoteliers who participated in this programme reportedly experienced approximately a 20% increase in their revenue within three months. Neither Oyo nor JP Morgan have commented on the recent credit facility.