Oravel Stays Limited, the parent Company of Oyo Rooms has recently published its annual financial report for the fiscal year 2022-23. This report uncovers significant financial trends across various parameters, including revenue, expenses, profits, and cash flows.

Financial Performance Highlights

1. Impressive Revenue Growth

In FY 2022-23, Oravel Stays Limited reported an outstanding 14% increase in revenue from operations, reaching Rs. 5463 crore, up from Rs. 4781 crore in FY22. Concurrently, the company managed to reduce expenses by 2.6%, with expenses totaling Rs. 6800 crore compared to Rs. 6985 crore in FY22. The growth was primarily driven by demand recovery, resulting in revenue growth, enhanced gross margins, and streamlined fixed cost structures, ultimately contributing to long-term sustainable growth and profitability.

2. Strong EBITDA Improvement

The Company's consolidated adjusted EBITDA witnessed a significant improvement, reaching INR 277 crore for FY 2022-23, compared to INR (471) crore in FY 2021-22.

3. Decrease in Loss Before Tax

The loss before tax for the Company decreased by an impressive 39% to Rs. (1286) crore in FY23, compared to Rs. (2141) crore in FY22. Similarly, the loss for the year saw a significant reduction of 34%, amounting to Rs. (1286) crore as opposed to Rs. (1941) crore in FY22.

Balance Sheet Overview

1. Total Assets and Equity & Liabilities

During FY23, the Company experienced a 6% decrease in total assets, which amounted to Rs. 7932 crore, down from Rs. 8452 crore in FY22. Correspondingly, the total equity and liabilities also decreased by 6%, totaling Rs. 7932 crore in FY23 compared to Rs. 8452 crore in FY22.

Cash Flow Insights

1. Strong Operating Cash Flow

The Company generated robust net cash from operating activities in FY23, amounting to Rs. 141 crore, in stark contrast to the cash used in operating activities, which was Rs. (921) crore in FY22.

2. Investing and Financial Activities

Notably, there was a positive trend in cash flow from investing activities in FY23, with a net cash generation of Rs. (108) crore. This was a significant improvement from the cash used in investing activities, which was Rs. (711) crore in FY22. In addition, cash flow from financial activities showed improvement, with cash used decreasing to Rs. (704) crore in FY23, compared to the cash generated of Rs. 703 crore in FY22.

Company Overview

OYO is an innovative technology platform dedicated to empowering small entrepreneurs and property owners to efficiently manage and operate their hotels and homes. By offering a full-stack of technology products and services, OYO simplifies operations and provides easy-to-book, affordable accommodation options for customers.

Business Model

Since its inception in 2012, OYO has been at the forefront of reshaping the short-stay accommodation industry. The company has developed a unique two-sided technology platform designed to comprehensively address the pain points of both Patrons (property owners, lessors, and operators) and Customers (travelers and guests). OYO's approach helps Patrons transform their unbranded and underutilized properties into digitally enabled, branded storefronts with increased revenue potential. Simultaneously, it provides Customers access to a wide range of high-quality accommodations at compelling price points through OYO's various platforms, including the OYO app, web, mobile web, online travel agents, and corporate partnerships.

Strategic Focus

Throughout the year, OYO maintained its global strategy, shifting from rapid growth to sustainable growth with a heightened emphasis on profitability. The company achieved this by optimizing its cost structure, reducing General & Administrative expenses, and refining marketing investments. Simultaneously, OYO doubled down on technology and product development to ensure operational efficiency.

IPO Plans

Subject to obtaining the necessary approvals and fulfilling other considerations, OYO is planning an Initial Public Offering (IPO) in accordance with the applicable regulations of the Securities and Exchange Board of India (SEBI). The company has submitted a Pre-filed draft red herring prospectus dated March 30, 2023 (Pre-filed DRHP) to SEBI in connection with this IPO.

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