Oyo Denies Reports of Withdrawing IPO, Source Says It’s ‘Exploring All Options’

Just two days after the Economic Times reported that Oyo had met with regulators to expedite its IPO, it reported that the hotel operator wanted to back out of the public offering.

Instead, the Economic Times report cited sources saying Oyo wanted to raise money with private investors.

“The company denies any rumors about withdrawing the IPO,” Oyo said in an official statement to Skift.

A source familiar with the process told Skift that an IPO is still on the table, but that it is also considering other ways to raise money.

“Yes, Oyo may look to raise money through investors, but no, it hasn’t quite given up on its plans to go public,” the source said.

If the company is able to raise enough money from investors then it might not have to go public, the source said. “Oyo is currently exploring all its options.”

IPO History

Oyo is mostly a budget hotel operator and aggregator, but forayed into the premium resorts and hotels category with the launch of its new brand, Palette. 

It first filed for the IPO in 2021. At the time, it had planned to raise around $1.16 billion and was seeking a valuation of around $12 billion.

In September 2022, Oyo’s value in the private market fell to around $6.5 billion after SoftBank Group – its largest investor – cut its valuation by more than 20%.

A year ago, the company announced it was reducing the IPO size size to between $400 and $600 million.

SoftBank owns around 46% of Oyo, and CEO Ritesh Agarwal and RA Hospitality own around 31% stake. Lightspeed and Peak XV Partners (formerly known as Sequoia Capital India), are some of the other investors in Oyo.

The company had earlier announced plans to repay INR 1.6 billion ($20 million) of debt through a buyback process. The debt repayment is slated for June 2026.

Oyo has reported two consecutive quarters of profit. This, the source said, has piqued the interest of investors and the company is currently in talks with investors.

In late January, according to a Bloomberg report, Oyo was in discussions with Malaysian sovereign wealth fund Khazanah Nasional Berhad to secure $400 million in funding at a $6 billion valuation. The company has reportedly also initiated preliminary discussions with at least two other investors.

Oyo Founder and Group CEO Ritesh Agarwal will be speaking at the Skift India Summit in Delhi on March 20.