Oyo Secures Rs 550 Crore Investment from Redsprig Innovation Partners

The investment was facilitated through a special resolution passed by Oyo’s board to issue 12,91,07,982 equity shares at an issue price of Rs 42.6 each. Regulatory filings accessed from the Registrar of Companies reveal that this move has increased Oyo’s valuation to $3.79 billion, reflecting a remarkable 59.2% growth compared to its previous valuation of $2.38 billion during the Series G round.

This capital infusion is earmarked to drive several critical initiatives. Oyo plans to strengthen its global presence by expanding into international markets and exploring acquisition opportunities. Additionally, the funds will be used to refine the company’s business strategies, ensuring it remains competitive in the evolving hospitality landscape. In which a significant focus will also be placed on corporate innovations and improving operational efficiency, all aimed at enhancing customer experience and meeting long-term business objectives.
The funding will result in a 1.728% dilution of Oyo’s total stake, a calculated move designed to align shareholder interests with the company’s growth ambitions.

This is not the first significant financial backing led by Agarwal. In August 2024, he spearheaded a $175 million funding round through his Singapore-based investment fund, Patient Capital. These contributions highlight Agarwal’s confidence in Oyo’s potential to revolutionize the global hospitality industry.

While investor interest in Oyo continues to rise, as evidenced by a recent investment by Nuvama Wealth & Investment Limited (formerly Edelweiss Securities). The firm purchased shares worth Rs 100 crore in Oyo’s parent company, Oravel Stays Limited, signaling strong market confidence in the company’s growth trajectory.
Oyo’s financial performance in FY24 underscores its resilience. While revenues remained stable at Rs 5,389 crore, slightly down from Rs 5,464 crore in FY23, the company’s strategic cost-cutting measures led to a 16% reduction in expenses. This resulted in a net profit after tax (PAT) of Rs 230 crore, marking a significant improvement in profitability despite stagnant revenue.

In May 2024, Oyo withdrew its draft red herring prospectus (DRHP) for the second time due to unfavorable market conditions. However, the company has announced plans to refile its IPO documents after completing the latest funding round, signaling readiness to re-enter the public market with a stronger financial foundation.
The Rs 550 crore investment from Redsprig Innovation Partners marks a transformative phase for Oyo. With a renewed focus on global expansion, technological advancements, and sustainable business practices, Oyo is well-positioned to redefine the hospitality experience on a global scale. As the company prepares for its IPO, it remains a trailblazer, setting new benchmarks in the travel and accommodation industry.