Skift Travel News Blog

SoftBank Group has reportedly cut the valuation of Indian hotel-booking platform Oyo by more than 20 percent, Bloomberg reported on Thursday quoting people familiar with the matter.

According to the report, the Japanese investor, who owns 45 percent of Oyo, cut its estimated value for initial public offering-bound Oyo to $2.7 billion in the June quarter from an earlier $3.4 billion. In 2019, Oyo had been valued at $10 billion.

The $2.7 billion valuation is lower than the $3.23 billion that Oyo has been able to raise through primary and secondary equity and debt funding rounds from investors. 

Calling the valuation markdown a speculation and “patently incorrect,” Oyo said that having clocked $1 million in earnings before interest, taxes, depreciation, and amortization in its fiscal 2023 first quarter, there is no rational basis for a markdown.

“A 41 percent gross profit margin and a 45 percent increase in gross booking value per hotel per month compared to the last financial year are dramatically improved results and the strong performance trajectory is expected to continue,” Oyo said in a statement.

Earlier this week, Oyo updated its initial public offerings application to the Indian regulatory body — Securities and Exchange Board of India (SEBI). The company originally planned to raise around $1.16 billion through the initial public offering, seeking a valuation of around $12 billion.

Oyo said that SEBI has given the company permission to file updated financials till the September 2022 quarter and Oyo would initiate the approval process post the filing of its audited numbers. “We have not decided the exact timing for the IPO and the IPO valuation is also highly speculative,” Oyo added.

Dubai International Airport expects passenger traffic to return to pre-pandemic levels by the end of 2023, a year earlier than its CEO Paul Griffiths’ prediction of hoping to regain pre-Covid traffic levels by 2024.

As air travel gets back to normal, Dubai Airport witnessed a half-yearly traffic of 27.9 million passengers this year, just 1.2 million shy of its total annual traffic last year.

Based on the strong first half, the airport has readjusted its annual forecast for 2022 to 62.4 million passengers, compared to its earlier estimate of 58.3 million.

The airport managed to hit 27.9 million for the first six months of 2022 despite a significant reduction in capacity following a 45-day shutdown of its northern runway in May-June for maintenance.

India was the top destination country for Dubai Airport with traffic for the first half reaching 4 million passengers. Saudi Arabia came in second with 2 million passengers, while United Kingdom came a close third with 1.9 million passengers.

Calling the airport’s recovery from the impact of Covid-19 spectacular, CEO Griffiths said, “We knew at the start of the pandemic that the dramatic downturn would be followed by an equally dramatic upturn, so we were well prepared for it and using all of the business data at our disposal were able to predict the start of the recovery.”

Speaking to the media, Griffiths also mentioned that Dubai has a lot to gain from the Federation Internationale de Football Association’s (FIFA) World Cup in Qatar this year — the first to be held in the Middle East.

Qatar Airways had earlier said that fellow Gulf Arab airlines would be operating daily shuttle flights to Qatar during the world cup, which would help ease pressure on Doha, which has been struggling with limited accommodation facilities for the world cup, and allow neighbouring Gulf states to benefit from the event.

Oyo has said it has won 1,250 corporate clients in the past three months across India, as business travel recovers in the country.

The new wins come from small and medium enterprises, traditional business houses and conglomerates, startups and travel management companies. Film production houses have also emerged as a key customer category, it said in a blog post on Wednesday.

The company added that it had engaged with 2,800 offline travel agents since January 2021.

Top cities include Bangalore, Hyderabad, Mumbai, Chennai, Ahmedabad, Kolkata, Pune and Delhi.
Its Business Accelerator division has serviced over 6,600 corporate clients since January 2021, it added.

“The appetite for business travel has returned strongly since the frequent change in travel restrictions has ebbed, making travel planning for business trips more certain and predictable. For a lot of our corporate customers, conducting business over virtual meetings was a stop gap and sub-optimal solution,” said Ankit Gupta, CEO of OYO, India.

Compared to leisure bookers, the startup’s business customers receive curated stay options, personalised customer support and integration with their accounting system.

The extra boost comes as Oyo delays its IPO — potentially until 2023. Earlier this month Oyo acquired Dubrovnik, Croatia-headquartered Direct Booker, which has 3,200 homes.

India’s civil aviation regulator cleared Jet Airways to resume operations, allowing what was once the country’s largest airline to operate commercial flights.

Jet Airways ceased flying in April 2019, buckling under the weight of an aggressive expansion strategy and what were called at the time operational missteps and a heavy debt load. The carrier first scaled back its international flights before declaring insolvency.

Numerous attempts were made to revive the brand in the last three years. A consortium of investors led by UK-based Jalan-Kalrock last year won approval to invest in the airline and restore its route network.

Details on the route network remain unclear, according to Reuters. Jet Airways said it started proving flights for its fleet on May 17 and is hiring staff.