Oyo, a Gurgaon, India-based hotel chain which offers hoteliers digital booking, payment and pricing analytic software, filed for an IPO with local market regulators today, seeking to raise approximately $1.16 billion in the offering.
The company has expanded its service from India to the U.S., Europe and Southeast Asia, and considers India, Indonesia, Malaysia and Europe its core growth market.
The New York Times questioned the start-up’s financial health in a report last year, stating its international expansion has been overly aggressive and that thousands of rooms are from unlicensed or unavailable hotels and guesthouses.
Despite this and reports the business was down 60% due to the pandemic, the filing marks a turnaround from that report, stating the company has corrected its course, according to TechCrunch.
The startup made a loss of $528 million on a total income of $600 million in the financial year ending in March this year. Oyo plans to deploy over $330 million of the IPO to repay its debt, $660 million of which was raised in a debt financing round in July 2021.
The hotel chain plans to issue new shares worth up to 70 billion rupees, with existing shareholders capable of selling up to 14.3 billion rupees worth of shares. SoftBank plans to sell stakes worth over $175 million, according to the filing.
The draft prospectus uploaded to ICICI Securities, a book running lead managers for the IPO, stated that Oyo is also considering issuing shares up to $193 million a pre-IPO placement.
Oyo was most recently valued at $9.6 billion, with investors including SoftBank, Airbnb, Lightspeed Venture Partners, Sequoia Capital India and Microsoft. The company’s most recent $5 million Series F in July led by Microsoft brought its total funding raised to over $4.1 billion, but paled in comparison to previous rounds of $1.5 billion, $100 million and $75 million in pre-pandemic 2019.
In other recent fintech news, charitable donation platform Daffy came out of stealth with over $4.8 million in seed funding. Fraud protection platform Alloy also raised a $100 million in a Series C led by Lightspeed Venture Partners to become New York City’s newest unicorn.