Hospitality startup Oyo adding up some funds lately. It is in the final stages of securing Rs 1,000 crore ($120 million) and primarily from the family offices of some of the prominent corporate executives and stock market experts. The notable figures include Anand Jain, a former senior executive at Reliance Industries, Mankind Pharma promoters Ramesh and Rajeev Juneja, and Utpal Sheth, a close aide of the late market maven Rakesh Jhunjhunwala.
Oyo was on the way of releasing initial public offering (IPO), but recently it has canceled the application. It is currently gearing up for an extraordinary general meeting (EGM) for the approval of fundraise following increase in its authorized share capital, which is expected to be valued at around $2.5 billion in the final round. It is to be noted that it witnessed a peak valuation of $9 billion in 2021.
Oyo is simultaneously in the final stages of negotiations with the Malaysian sovereign wealth fund Khazanah Nasional. It is expected to get funding of Rs 250-300 crore. The partnership will add credibility to Oyo’s investor base.
The EGM notice indicates to consider approving an initial fundraise of around Rs 500 crore. Most individual investments are expected to range between Rs 15-30 crore. Investors are optimistic about the potential returns.
CEO Ritesh Agarwal has been lately engaging actively with potential investors. The company’s largest investor is SoftBank and it had previously reduced valuation to $2.7 billion from $3.4 billion. This reflected challenges faced by the hospitality sector and particularly during the COVID-19 pandemic period in 2020 and 2021.
