IPO-bound OYO becomes profitable in Q4 of FY23 as it prepares for stock market listing

In an internal townhall held recently, OYO’s founder Ritesh Agarwal announced that the company has turned cash flow positive for the first time in the fourth quarter of FY23. The decacorn ended the quarter with a surplus cash flow of Rs 90 crore, Agarwal reportedly told OYO's employees. 

A source told Business Today that the company attributed this milestone to seeing an increase in bookings across all key geographies, especially in Europe where the homes business has seen an “unprecedented advance in bookings” for both the peak season as well as the relatively off-season period from November to March. All these factors have led the company to become profitable, OYO’s top boss is said to have announced in the townhall. 

“The positive cash trajectory is expected to continue into the first quarter of FY24. The company’s last reported treasury or cash corpus on the balance sheet is Rs 2,700 crore,” Agarwal told the employees. Moreover, the company is also planning to add 1,800 hotels in its premium category this year, the source told BT. 

In December last year BT reported that the company will delay the IPO by a quarter, as the market watchdog has written back to the company asking it to update additional sections in its Draft Red Herring Prospectus (DRHP), such as updated risk factors, key performance indicators (KPIs), outstanding litigations, basis for valuation etc. The hospitality company refiled its DRHP and submitted it to Sebi in February.

BT also reported that the company is expecting to close its adjusted EBITDA (for second half of FY23) at Rs 185 crore, which is a 3x increase from H1 (Rs 63 crore). In FY22, OYO reported a net loss of Rs 1,851 crore against Rs 4,905 crore of revenue. Additionally, the company which has been planning to go public since 2021 is aiming to get listed during the Diwali season this year, sources told BT.

BT reached out to the company for an official comment but failed to get a response on the same. 

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