Budget hotel chain Hotels in Oyo and Homes plans and is expected to raise approximately $ 1 billion through an initial public offering (IPO) Draft of the Red Herring prospectus (DRHP) next week, bank sources announced ET.
The IPO, tentatively pegged at between $ 1 billion and $ 1.2 billion, will consist of a reissue of shares and an offer to sell (OFS) from existing shareholders, the sources said. The company supported by SoftBank has Mahindra capital Kotak, JP Morgan and Citigroup to manage the public issue.
“The IPO papers are ready and the bankers are awaiting final approval from the company before filing them with the Securities and Exchange Board of India (Sebi),” said one of the people. “Most likely, the DRHP will be filed before September 30,” the person added.
Oyo did not respond to requests from ET seeking comment.
Oyo is the seventh Indian tech unicorn to either enter the primary market or to plan, after CarTrade Tech, Paytm, GuidelinesBazaar, Nykaa and Mobikwik.
While Zomato and CarTrade Tech successfully completed their IPOs in July and August, the others submitted their draft prospectuses to the capital market regulator.
PolicyBazaar and Nykaa IPOs are expected in the first half of October.
Last week, the shareholders of Oravel Stays, Oyo’s parent company, approved the conversion from a limited liability company to a public company.
The company also increased its authorized share capital from 1.17 billion yen to 901 billion yen earlier this month. Oyo has expanded its paid-up share capital through a stock split and a bonus issue.
The nominal value of the share was divided for all shares and preference shares in a ratio of 1:10.
In addition, the company has awarded 3,999 bonus shares for each share held. For preference shareholders, the conversion ratio into equity shares has been changed from 1: 1 to 1: 4,000.
The bonus was awarded to 15 shareholders, including founder Ritesh Agarwal, Japan’s SoftBank, Lightspeed Venture Partners, Microsoft Corp, Oravel Employee Welfare Trust and Sequoia Capital.
Microsoft recently invested $ 5 million in the hotel company, making Oyo nearly $ 9.6 billion worth of money.
Oyo, which is also backed by investors like Airbnb and Grab, operates in 35 countries with India, Europe and Southeast Asia being the main markets.
The company told ET last month that there is a stronger recovery in Europe due to higher vaccination rates and that it would also be reflected in India as more people are vaccinated.
Currently, 43% of Oyo’s sales come from India and Southeast Asia, 28% from Europe and other global markets.
