When Will OYO Take its IPO Public and What Can be the Projection for its Shares?
OYO is awaiting the Security Exchange Board of India’s (SEBI) nod to launch its very first IPO. Early investors are likely to enjoy huge returns once the firm goes public. More and more unicorns are launching their initial public offers recently, and OYO is planning the same—and the IPO is expected to be massive.
The Oyo Share Price is likely to increase in the coming days. Considering the assumed valuation at $9.6 billion (Microsoft’s investment), the number of shares is expected to be around 6.4 billion (according to DRHP, Draft Red Herring Prospectus). The average cost of single equity is likely to see a return going up by 770%.
It is expected that the OYO’s unlisted share price will be adjusted to raise Rs 8,430 crores through the primary issue. And early investors of the company, such as Airbnb, Microsoft, Lightspeed Ventures and Sequoia, Hindustan Media Ventures, etc., will not be selling their shares. Softbank (one of the biggest shareholders) will offload around 2% of its stakes via IPO.
Things you must know about the OYO IPO.
The IPO will be launched soon, and if you are concerned about the shares, you must know these things about the OYO IPO.
- The company is owned by Oravel Stays Ltd., which will be disclosed on the IPO launch day. But, OYO is popularly known as OYO Rooms, and it is an online chain of hotel rooms and short stay houses.
- The overall size of the public offer is estimated to be Rs. 8,430 Cr. This includes a fresh issue of Rs. 7,000 Cr. and an offer for sale of Rs. 1,430 Cr. SVF India holdings will be tendering shares worth Rs. 1,329 Cr in the OFS (Offer for Sale).
- Ritesh Agarwal, the promoter of OYO Rooms, holds a 24.94% stake in the holding company, i.e., Oravel Stays. He is not offering any shares as a part of the OFS.
- Much like every other digital start-up, OYO Rooms has been making losses for the last few years. In the financial year 2021, the reported net loss was Rs. 3,942 Cr. In the financial year 2020, the net losses were Rs. 13,123 Cr.
- The Rs. 7,000 Cr. fresh issue proceeds will be utilized by OYO Rooms to reduce its debt and expand its businesses’ inorganic and organic expansion. As of March 2021, the firm has a consolidated debt of Rs. 4,891 Cr.
- The company’s model is mainly based on US firm Airbnb. Airbnb was the pioneer of the concept of Bed and Breakfast (BNB) rooms sold over the internet. Airbnb is one of the largest hotel chains in the world right now.
- OYO has over 157,000 storefronts (homes & hotels) spread across 35 countries. Its focus is on India, Malaysia, Europe, and Indonesia. The company is the second-largest loyalty franchise in India after Inter Miles of Jet Airways.
- OYO is waiting for SEBI’s approval on the recently filed DRHP.
If you plan to invest in OYO shares, these are the points you must keep in mind. It will help you sort out things before making a decision.
There’s no doubt about the rise in the Oyo Share Price, and OYO is a promising start-up, and that’s why several firms are investing in the company. You can expect positive growth in OYO shares in the coming years.
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