Oravel Stays Pvt. Ltd filed the documents for a ??The initial public offering (IPO) of 8,430 crore which is expected to value the unicorn hotel operator Oyo Hotels and Homes at least at $ 10 billion.
The initial sale of shares will see some of its investors, including the Japanese group SoftBank, sell part of their stake. The issue will include a first capital increase of approximately ??7,000 crore and sales of equity interests by investors worth ?? 1,430 crores.
SoftBank Group sells stocks worth ??1,328.53 crore, while Grab, which invested $ 100 million in Oyo in 2018, sells about ??51.6 crore of shares. Huazhu Hotels, which invested in 2017, sells about ??23.13 crores. Hero Group Sunil Munjal’s family business also sells shares worth ??26.71 crores.
Oyo founder Ritesh Agarwal, 27, will not sell his shares. In addition, Sequoia Capital and Lightspeed Ventures are also not selling shares as part of the IPO.
The filing with the capital markets regulator is the latest example of a rush to public markets by unicorn Indian startups, including Paytm, Nykaa, Ixigo and Policy Bazaar, in the midst of a dizzying stock market rally. Bankers involved in the issue include Kotak Mahindra Capital, Citigroup, JP Morgan, ICICI Securities, Nomura, JM Financial and Deutsche Bank. Currently, founder Agarwal owns an 8.21% stake, while an affiliate promotion company, RA Hospitality Holdings Cayman, owns 24.94%.
In 2019, Agarwal bought back part of the shares of investors Sequoia Capital and Lightspeed Ventures through RA Hospitality Holdings.
Currently, SoftBank Group owns 46.62%, Grab 1.81%, Huazhu Hotels 0.81% and the Munjal family 0.04% in the company.
The proceeds from the sale of shares are worth ??2,441 crore will be used to repay debt owed by its subsidiaries Oravel Stays Singapore Pte Ltd, Oravel Hotels LLC and Oyo Hospitality Netherlands BV and Oyo Singapore and OHL.
In July, the company had total borrowings of ??4,890.56 crore on a consolidated basis.
For fiscal year 2020-21, its total income amounts to ??4,157.39 crore ??1,3413.27 crore the previous year. Net loss reduced to ??4,102.28 crore ??11,079.79 crores.
Upstream of its deposit, Oravel increased its share capital by ??1.17 crore to ??901 crore earlier this month.