OYO Gets Shareholders’ Nod To Raise INR 417 Cr

OYO Founder Ritesh Agarwal To Raise Stake In The Company

SUMMARY

OYO received the approval of its shareholders to issue 14.37 Cr Series G CCCPS to InCred Wealth through private placement

During the extraordinary general meeting, the shareholders also gave their assent to increase OYO’s authorised share capital to INR 1,341.14 Cr from INR 901.14 Cr previously

OYO reported its first full year of profitability in the financial year 2023-24 (FY24) and clocked a net profit of about INR 100 Cr, founder and CEO Ritesh Agarwal said last month

Travel tech major OYO has reportedly received the approval from its shareholders to raise INR 416.85 Cr by issuing preference shares.

The approval was received at the startup’s extraordinary general meeting (EGM) held on June 18, Economic Times reported citing sources. The report said that OYO received shareholders’ nod to issue 14.37 Cr Series G cumulative compulsorily convertible preference shares (CCCPS) to InCred Wealth through private placement.

The preference shares will be valued at INR 29 each, translating into a cumulative sum of INR 416.85 Cr. The resolution was passed with a 99.99% majority at the EGM.

During the meeting, the shareholders reportedly also gave their assent to increase OYO’s authorised share capital to INR 1,341.14 Cr from INR 901.14 Cr earlier.

The increase in authorised share capital would provide the company with “greater flexibility” to issue new shares as it pursues future opportunities.

“This EGM marks an important milestone for OYO as the company’s ability to raise funds and restructure its capital base underscores investor confidence in its long-term vision and prospects,” the report quoted a source as saying.

Inc42 has reached out to OYO for a response on the development. The story will be updated on receiving comments from the startup.

The development comes days after reports surfaced that the hospitality giant was in advanced discussions to raise INR 1,000 Cr in funding from family offices of leading Indian corporate executives Ramesh Juneja and Rajeev Juneja, the promoters of Mankind Pharma, and stock market expert Anand Jain.

The approval also comes a month after OYO officially withdrew its IPO documents.

Founded in 2012 by Ritesh Agarwal, OYO is a travel tech startup that offers easy-to-book and affordable accommodation to customers around the world. It claims to have more than 1.57 Lakh hotels under its umbrella across 35 countries, including India, Europe, and Southeast Asia.

OYO reported its first full year of profitability in the financial year 2023-24 (FY24) and clocked a net profit of about INR 100 Cr, Agarwal claimed in a social media post last month. OYO also claimed to have posted its eighth successive EBITDA positive quarter in Q4 FY24, with the startup’s cash reserves hovering around the INR 1,000 Cr mark at the end of the fiscal year.