Sebi returns OYO's draft IPO papers; asks to refile with 'applicable' updates

Capital markets regulator Sebi has asked Oravel Stays Ltd, the parent company of travel-tech firm OYO, to refile the draft IPO papers with 'applicable' updates.

The move might delay the Gurugram-based hospitality unicorn's initial public offering (IPO).

SoftBank-backed OYO filed preliminary documents with the Securities and Exchange Board of India (Sebi) in September 2021 for a Rs 8,430-crore IPO.

The proposed offering consists of a fresh issue of shares of up to Rs 7,000 crore and an offer-for-sale of as much as Rs 1,430 crore.

"The updated information will also revise the basis of the offer price and other sections of the DRHP. The processing time of collating the additional information and submitting will take at least a quarter, which would delay the stock market debut," reported Business Today on December 31. 

According to an update with Sebi's website on Tuesday, the markets regulator returned the company's Draft Red Herring Prospectus (DRHP) on December 30, 2022 and asked the firm to refile it with applicable updates/ revisions.

However, the regulator has not elaborated on the updates or revisions required in the draft documents.

Business Today on December 31 reported that Sebi has written back to the company asking it to update additional sections in its DRHP, such as updated risk factors, key performance indicators (KPIs), outstanding litigations, basis for valuation etc., reported Business Today.

Earlier, the company had filed an addendum to its DRHP, which included its financials for the first half of FY23. It reported a profit of Rs 63 crore for the first half of FY23 as against a loss of Rs 280 crore a year ago.

The company's revenues in the first half (April-September) of FY23 grew 24 per cent year-on-year to Rs 2,905 crore. Apart from improving operating performance, the company has a cash corpus of Rs 2,785 crore, the filing to Sebi showed.

The markets regulator had given OYO the permission to submit updated financials before it examined and processed the company's application for IPO. Sebi returns OYO's draft IPO papers; asks to refile with updates. OYO is backed by the likes of Microsoft, SoftBank Vision Fund, Lightspeed Venture Partners, Sequoia Capital India, and others.

With inputs from agencies