India’s Oyo Hotels & Homes filed preliminary documents for an 84.3 billion rupee ($1.1bn) initial public offering, joining the rush of technology unicorns seeking to list on the country’s exchanges after a world-beating stock rally.
The hotel-booking service, backed by SoftBank Group and Airbnb, plans to raise 70bn rupees through the sale of new shares, according to the filing. The rest will be secondary shares or those sold by existing stockholders.
The start-up was last valued at about $9bn, according to CB Insights, making it India’s third most valuable start-up.
Founder Ritesh Agarwal, his holding company RA Hospital Holdings and SoftBank Vision Fund – the three largest shareholders – are the promoters, according to the prospectus. SoftBank held 47 per cent while Mr Agarwal and his holding company have a combined 33 per cent stake in the company.
The filing of the draft red herring prospectus of Oyo, which is officially known as Oravel Stays, marks a dramatic recovery after the Covid-19 pandemic buffeted the travel and hospitality industry.
The start-up has refashioned itself, moving away from a business model that brought financial stress, soured its relationship with hotel owners and brought on court battles.
Oyo has stopped offering minimum guarantees to its 157,000 partners – hotels, homes and resorts on its marketplace that it calls storefronts – and no longer invests in upgrading the standards of the hotels. Instead, the company forges revenue-sharing pacts with partners and gets full and exclusive control over the hotel owner’s inventory.
The company has made progress in moving to profitability despite the pandemic. Its loss for the fiscal year ended in March narrowed to 39.3bn rupees from 128bn rupees the year before, despite a sharp decline in revenue because of the Covid-19 pandemic.
The company said its adjusted gross profit, which excludes certain costs, rose to 13.2bn rupees in the latest fiscal year, up from 12.8bn rupees. Adjusted gross margins rose to 33 per cent from 9.7 per cent in March 2019, the filing showed.
Oyo is the latest Indian unicorn to file its intent to go public after food delivery start-up Zomato became the first to list in July.
Digital payments start-up Paytm and Nykaa, an online retailer of beauty products, are among others that have filed initial documents. Edtech Byju’s, the country’s most valuable start-up, is also considering an IPO in the early half of 2022, Bloomberg News reported.
Mr Agarwal established Oyo in 2013 after dropping out of college. Now 27, he will be worth billions of dollars if Oyo has a successful listing.
The high-profile entrepreneur was part of a rarefied group of SoftBank-backed start-up founders coached by Masayoshi Son himself. In 2019, Mr Agarwal invested $2bn, mostly borrowed, to triple his stake in the lodgings start-up and take his ownership to nearly a third.
Mr Agarwal does not plan to sell any shares in the offering, while SoftBank will offload a small stake. Other prominent investors Sequoia Capital, Lightspeed Ventures and Greenoaks Capital Management do not intend to sell.
Kotak Investment Banking, JPMorgan Chase and Citigroup are the global co-ordinators and bookrunners for the IPO. ICICI Securities, Nomura Holdings and JM Financial are the other bookrunners.
India, Malaysia, Indonesia and Europe account for more than 90 per cent of the hotels listed on Gurgaon-based Oyo’s platform. The budget lodgings marketplace also offers stays in China, the US and dozens of other countries, although its global expansion was curtailed by the pandemic.
The app has been downloaded 100 million times, according to the filing, making it one of the most popular travel apps in the world alongside Airbnb and Booking.com. It has more than nine million users in its loyalty programme, generating direct demand from customers.
More than two thirds of its workforce, including its technology team, are based in India, according to the IPO filing. In its home market, more than 92 per cent of hotels are unbranded, standalone properties that fall under the “unorganised” hotel category, according to the filing.
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Name: Brendalle Belaza
From: Crossing Rubber, Philippines
Arrived in the UAE: 2007
Favourite place in Abu Dhabi: NYUAD campus
Favourite photography style: Street photography
Favourite book: Harry Potter
Name: Peter Dicce
Title: Assistant dean of students and director of athletics
Favourite sport: soccer
Favourite team: Bayern Munich
Favourite player: Franz Beckenbauer
Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates
THE BIO
Family: I have three siblings, one older brother (age 25) and two younger sisters, 20 and 13
Favourite book: Asking for my favourite book has to be one of the hardest questions. However a current favourite would be Sidewalk by Mitchell Duneier
Favourite place to travel to: Any walkable city. I also love nature and wildlife
What do you love eating or cooking: I’m constantly in the kitchen. Ever since I changed the way I eat I enjoy choosing and creating what goes into my body. However, nothing can top home cooked food from my parents.
Favorite place to go in the UAE: A quiet beach.
What is Diwali?
The Hindu festival is at once a celebration of the autumn harvest and the triumph of good over evil, as outlined in the Ramayana.
According to the Sanskrit epic, penned by the sage Valmiki, Diwali marks the time that the exiled king Rama – a mortal with superhuman powers – returned home to the city of Ayodhya with his wife Sita and brother Lakshman, after vanquishing the 10-headed demon Ravana and conquering his kingdom of Lanka. The people of Ayodhya are believed to have lit thousands of earthen lamps to illuminate the city and to guide the royal family home.
In its current iteration, Diwali is celebrated with a puja to welcome the goodness of prosperity Lakshmi (an incarnation of Sita) into the home, which is decorated with diyas (oil lamps) or fairy lights and rangoli designs with coloured powder. Fireworks light up the sky in some parts of the word, and sweetmeats are made (or bought) by most households. It is customary to get new clothes stitched, and visit friends and family to exchange gifts and greetings.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
Super Saturday race card
4pm: Mahab Al Shimaal Group 3 | US$350,000 | (Dirt) | 1,200m
4.35pm: Al Bastakiya Listed | $300,000 | (D) | 1,900m
5.10pm: Nad Al Sheba Turf Group 3 | $350,000 | (Turf) | 1,200m
5.45pm: Burj Nahaar Group 3 | $350,000 | (D) | 1,600m
6.20pm: Dubai City of Gold Group 2 | $300,000 | (T) | 2,410m
6.55pm: Al Maktoum Challenge Round 3 Group 1 | $600,000 | (D) | 2,000m
7.30pm: Jebel Hatta Group 1 | $400,000 | (T) | 1,800m
Killing of Qassem Suleimani
Salah in numbers
€39 million: Liverpool agreed a fee, including add-ons, in the region of €39m (nearly Dh176m) to sign Salah from Roma last year. The exchange rate at the time meant that cost the Reds £34.3m - a bargain given his performances since.
13: The 25-year-old player was not a complete stranger to the Premier League when he arrived at Liverpool this summer. However, during his previous stint at Chelsea, he made just 13 Premier League appearances, seven of which were off the bench, and scored only twice.
57: It was in the 57th minute of his Liverpool bow when Salah opened his account for the Reds in the 3-3 draw with Watford back in August. The Egyptian prodded the ball over the line from close range after latching onto Roberto Firmino's attempted lob.
7: Salah's best scoring streak of the season occurred between an FA Cup tie against West Brom on January 27 and a Premier League win over Newcastle on March 3. He scored for seven games running in all competitions and struck twice against Tottenham.
3: This season Salah became the first player in Premier League history to win the player of the month award three times during a term. He was voted as the division's best player in November, February and March.
40: Salah joined Roger Hunt and Ian Rush as the only players in Liverpool's history to have scored 40 times in a single season when he headed home against Bournemouth at Anfield earlier this month.
30: The goal against Bournemouth ensured the Egyptian achieved another milestone in becoming the first African player to score 30 times across one Premier League campaign.
8: As well as his fine form in England, Salah has also scored eight times in the tournament phase of this season's Champions League. Only Real Madrid's Cristiano Ronaldo, with 15 to his credit, has found the net more often in the group stages and knockout rounds of Europe's premier club competition.
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Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
The Programme
Saturday, October 26: ‘The Time That Remains’ (2009) by Elia Suleiman
Saturday, November 2: ‘Beginners’ (2010) by Mike Mills
Saturday, November 16: ‘Finding Vivian Maier’ (2013) by John Maloof and Charlie Siskel
Tuesday, November 26: ‘All the President’s Men’ (1976) by Alan J Pakula
Saturday, December 7: ‘Timbuktu’ (2014) by Abderrahmane Sissako
Saturday, December 21: ‘Rams’ (2015) by Grimur Hakonarson
Our legal advisor
Ahmad El Sayed is Senior Associate at Charles Russell Speechlys, a law firm headquartered in London with offices in the UK, Europe, the Middle East and Hong Kong.
Experience: Commercial litigator who has assisted clients with overseas judgments before UAE courts. His specialties are cases related to banking, real estate, shareholder disputes, company liquidations and criminal matters as well as employment related litigation.
Education: Sagesse University, Beirut, Lebanon, in 2005.
