According to reports, the lead bankers and senior executives of hospitality unicorn OYO have met with officials from the Securities and Exchange Board of India (SEBI). This meeting was held to provide an update on the company’s business performance and address any lingering concerns as they strive to accelerate the approval process for its initial public offering (IPO).
According to a report from ET, OYO officials have notified the regulator about a partial prepayment of $200 million on the company’s outstanding Term Loan B.
The report also indicated that they provided updates on the improvements in the company’s bottom line and various financial metrics over the last four quarters.
OYO chose not to respond to queries regarding the matter.
This development comes after almost a year since OYO, operated by Oravel Stays, pre-filed a draft red herring prospectus (DRHP) with SEBI, reducing the issue size for the company’s public listing to almost half in tune with the changed realities.
The DRHP was submitted through the confidential pre-filing pathway, featuring a reduced issue size of $400-600 million, down from the initial $1.2 billion. However, there has been no subsequent update regarding the finalization of the DRHP since then.
Aligned with prevailing market sentiment, OYO intensified its focus on profitability strategy since the previous year in anticipation of an IPO. According to its FY23 filing, the unicorn witnessed a 34% year-on-year (YoY) reduction in net loss, amounting to INR 1,286.5 crore for the fiscal period under review.
Continue Exploring: IPO-bound OYO’s Q3 FY24 profit doubles QoQ to INR 30 Cr
During Q2 FY24, OYO recorded its first profitable quarter, achieving a Profit After Tax (PAT) of over INR 16 crore. Continuing to bolster its foundational strength, OYO achieved a second consecutive profitable quarter in Q3 FY24, with PAT doubling to INR 30 crore.
Conversely, OYO prepaid approximately one-third of its outstanding TLB, amounting to around INR 1,620 crore ($195 million), through a debt buyback process.
Continue Exploring: OYO initiates INR 1,620 Cr debt repurchase, aims to proactively settle one-third of Term Loan B
Recently, OYO has also been in discussions with the Malaysian sovereign wealth fund Khazanah Nasional Berhad, aiming to secure funding of nearly $400 million.
Continue Exploring: Oyo Hotels in advanced talks with Khazanah Nasional Berhad for $400 Million funding boost