SoftBank-backed Oyo eyes $12bn valuation in Indian IPO; Sources

By Amirtha P S, Desk Reporter
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SoftBank-backed Indian hotel aggregator Oyo is seeking a valuation of $10 billion to $12 billion, as it filed for a local listing that could be the first for a hospitality firm since 2019, according to a source close to the matter.

The hotel aggregator, which Japanese conglomerate SoftBank counts among its biggest bets, had hinted about an initial public offering (IPO) in 2019 shortly before the pandemic disrupted the travel industry. Now the long-awaited IPO comes at a time when travel restrictions are being eased across the globe and the tourism sector is rebounding as people head out on vacations.

The Gurgaon-based startup, officially known as Oravel Stays, provides an operating system of sorts to help hoteliers accept digital bookings, payments, determine the best pricing for a room, and integrates with third-party booking services.

The offering will consist of a fresh issue of shares of up to $942.8 million and an offer for sale of as much as $190 million, according to a copy of its draft red herring prospectus dated September 30.

According to Oyo’s draft herring prospectus, the offer for sale comprises equity shares aggregating up to $180 million by SVF India Holdings, a firm incorporated in the Cayman Islands to hold the investments on behalf of SoftBank Vision Fund.

Oyo is the latest among a series of tech-focused companies to tap a booming Indian IPO market, which has seen roughly 30 firms seeking a stock launch so far this year.

Food delivery platform Zomato had a stock market debut in July, while Ant Group-backed Paytm and TPG-backed eCommerce beauty firm Nykaa have also filed initial offers to go public.

The offering also comes at a time when Oyo is facing a legal fight with rival Zostel over a deal between the two Indian hospitality startups that fell apart six years ago.

Last week, it was reported that the firm was looking to raise around $1 billion to $1.2 billion via the IPO. JPMorgan, Kotak Mahindra Capital and Citi are among the lead book-running managers for the IPO.

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