Oyo to meet bankers next week for third IPO attempt; eyes $5–7 billion valuation
Oravel Stays, the parent of hospitality firm Oyo, is set to formally invite pitches from merchant bankers next week as it gears up for a third attempt at an initial public offering (IPO), people familiar with the matter told ET.
'Oyo's management has been holding informal discussions with bankers over the past month and is now moving to formally hear proposals,' one person aware of the matter said. 'Some banks have floated a potential valuation as high as $10 billion, but Oyo's internal expectations are more grounded, in the $6–7 billion range.'
The company is in talks with both Indian and international investment banks and is likely to file its draft red herring prospectus (DRHP) between August and September this year, another source said. The company is targeting a public listing in the March–April 2026 window, the person added.
This marks Oyo's third attempt towards a public listing. It first filed a DRHP with the Securities and Exchange Board of India (Sebi) in 2021, targeting an IPO size of Rs 8,430 crore, but withdrew the proposal in 2022. A second attempt via Sebi's confidential filing route in 2023 was also pulled back in 2024.
One key factor influencing the IPO push is the pressure from a $2.2 billion loan taken by founder Ritesh Agarwal in 2019 to increase his stake in the company. Sources indicated that discussions with lenders about extending the repayment timeline are linked to Oyo's listing plans.
A round of strategic talks between Oyo's board and major shareholders, including SoftBank—which owns around 40% of the company—is slated for June. 'The board and shareholders, including SoftBank, are aligned on taking the company public soon, particularly after the sharp turnaround in business,' a person aware of the matter said, adding that Oyo is estimated to have posted a net profit of Rs 620 crore in FY25.
Oyo did not respond to ET's queries. The development was first reported by Press Trust of India.
The company has rationalised its global operations while consolidating its presence in key markets such as India, the US, Europe and Southeast Asia. Oyo is yet to file its financials for FY25 but is expected to include them—along with Q1 FY26 results—in its upcoming DRHP.
Last year in August, Oyo raised Rs 1,457 crore from a consortium of investors at a sharply lower valuation. In December, it raised $825 million in debt from Deutsche Bank to finance its acquisition of US motel chain Motel 6 for $525 million. The all-cash deal is Oyo's largest acquisition to date.
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