OYO's Early Investors Exit With Massive Returns Ahead of IPO

Early investors in OYO have started selling their stakes in the hospitality start-up. Currently, Lightspeed Venture Partners is in talks with a consortium of family offices to sell a portion of their stakes at a valuation of $3.9 billion, according to The Economic Times report.

Prior to this, Peak XV Partners has also sold some of its remaining 3% stake. The investor has earned approximately $80-90 million in returns from the sale. The report also stated that Peak XV had made $500 million in exits from the hospitality start-up before the latest sale.

This is in addition to the more than $1.4 billion that Lightspeed and Peak XV collectively earned in 2019 by selling the majority of their stakes to OYO founder Ritesh Agarwal.

The upcoming stake sale is set for a premium of over 60% compared to the ₹1,457 crore funding round in August 2024, during which leading family offices invested in the now-profitable hospitality start-up backed by SoftBank Group.

Also Read | OYO Secures Rs 550 Crore Funding as CEO Ritesh Agarwal Eyes Global Growth

OYO's Recent Fundraising

Recently, OYO has raised Rs 550 Crore (around $65 million) from Redsprig Innovation Partners, owned by the start-up’s founder. This equity issuance resulted in a 1.728 per cent dilution of the company’s total stake. The raised funds will primarily be used for global expansion and growth.

Regulatory filing accessed from the Registrar of Companies shows that the OYO board has passed a special resolution to issue 12,91,07,982 equity shares at an issue price of Rs 42.6 each to raise Rs 550 crore.

This was Agarwal's second major capital infusion in OYO. In August 2024, he led a $175 million round through his Singapore-based fund, Patient Capital. Earlier, Nuvama Wealth & Investment Limited purchased ₹100 crore worth of shares in OYO’s parent entity Oravel Stays Limited.

Also Read | Nuvama Wealth Acquires Shares Worth Rs 100 Crore in OYO Via Secondary Market

OYO IPO in 2025

The Gurugram-based start-up has withdrawn its IPO draft papers twice due to unfavorable conditions. The firm reportedly said that it would refile the papers after concluding a large funding round, which is about to close after the latest fundraises. However, some reports suggest that OYO IPO's listing date will be around the second week of March 2025.