New Delhi: Global hospitality services platform Oyo has filed addendum to its earlier submitted draft red herring prospectus to market regulator Securities and Exchange Board of India on Monday.
This additional information is expected to help investors in taking better and well-informed decisions regarding its public issue. OYO has around 1.68 lakh storefronts across more than 35 countries that benefit from its platform.
While OYO has a global footprint, its core growth markets comprise India, Indonesia, Malaysia and Europe.
OYO’s share of the total addressable market in its core growth markets was less than one per cent creating significant opportunities for it to grow its footprint. OYO has significant opportunities as 88 per cent of global hotels are in the unorganised space.
Faced with challenges that emanated from the Covid-19 pandemic, the company implemented a number of measures, including accelerated adoption of technology and products to reduce operating costs, and repositioning its services offerings.
As a result of various initiatives that the company took, its adjusted gross profit margin improved from 9.7 per cent in fiscal 2020 to 33.2 per cent in fiscal 2021 along with approximately 79 per cent reduction in its EBITDA losses from fiscal 2020 to 2021 despite the pandemic.
EBITDA further narrowed and reported its maiden positive during the first quarter of the current fiscal, driven by an increase in the overall Gross Booking Value (GBV) while also improving the company’s per unit business economics. The EBITDA during the quarter was Rs 7 crore (USD 1 million).Coming to the company’s EBITDA margins, it has risen to 0.5 per cent in Q1 2022-23 from (-) 44 per cent in 2021 and (-) 9.9 per cent in 2022.
The biggest shift in the financials appears to be in the monthly gross bookings value per hotel, with a 47 per cent growth in Q1 FY23 to Rs 3.25 lakh as against Rs 2.21 lakh for fiscal 2022.This increase in booking values could somewhat be attributed to the recovery in travel demand due to the easing of travel and domestic movement restrictions in the markets where it operates.
“The performance in the ongoing quarter seems to indicate another EBIDTA positive quarter. OYO may be able to generate positive free cash flow by the end of this fiscal if the revenue growth continues at the same or higher pace and the control on costs that OYO has been able to achieve continues.” a source close to the company told.
Emerging from the impact of the once in a century pandemic, OYO’s revenue from operations has seen an uplift of 21 per cent to Rs 47,814 million in financial year 2022 from Rs 39,616 million in 2021 on account of revival in hospitality sector.OYO’s strong foothold in its core markets of India and South Asia played a critical role in its resurgence over the last quarter. Converting huge revenue potential across online demand channels in these markets has been one of the main growth drivers for the company.
The revenue growth momentum continued during Q1 of the current fiscal as it reported revenue worth Rs 14,593 million during the period.
