On Monday, August 9, OYO Hotels & Rooms has shortlisted JP Morgan, Kotak Mahindra Capital, and Citi for its $1.2 billion initial public offerings (IPO). The SoftBank-backed Indian hospitality startup is expected to add more bankers as the IPO process matures.
According to sources, the three investment banks were taken on board recently, though no official statements are made by OYO.
A report informed that the work on the initial public offering has begun, adding the company is leaning towards a debut in the domestic market but has kept its options open.
In July, OYO's chief executive officer, and founder, Ritesh Agarwal had said that its business was likely to return to levels seen before the second wave of COVID-19 infections in India.
He had informed, "In India, if all goes well, in a couple of weeks our numbers will be back to pre-wave two and then growing from there".
Referring to travel demands slowly returning in India with restrictions ease concerning travel and vacations, Agarwal had said, "Staycations are in vogue and the trend of work from anywhere is not a short-term one".
Emphasizing OYO aggregates bookings for India's budget hotel and allows guests to book hotels via its mobile app, he said the business would consider a potential public offering.
He had earlier informed, "We are looking at upcoming IPOs very closely, I'm sure our board will weigh in on our business progress and general listings of technology companies."
The hotel aggregator, in which SoftBank owns a 46% stake and is one of its biggest bets, has endured months of layoffs, cost cuts, and losses during the global health crisis. However, with easing travel curbs and increasing vaccinations, travel demand is slowly picking up in India.
Microsoft Corp (MSFT.O) in July was in advanced talks to invest in OYO at a valuation of $9 billion in a prelude to OYO's IPO, Reuters had reported, citing a source familiar with the matter.
In 2013, OYO was launched by Ritesh Agarwal. Currently, the company has a network of 100,000 small hotels and homeowners spread across 800 cities in 80 countries. The year 2020 was bad for the business as India had imposed travel restrictions amid the COVID-19 pandemic.