For the first time in the fourth quarter of FY23, OYO reported a positive cash flow. In the town hall virtual meeting, OYO founder and CEO Ritesh Agarwal shared updates with the employees about the growth in the positive cash flow as compared to the last quarter of the financial year. Recently, OYO, also known as Oravel Stays Limited, made a shuffle in its top management before its highly anticipated Initial Public Offering (IPO).
The company's performance has been exceptional in the past few months, resulting in increased demands in hotel booking across all vital geographical regions. Besides this, OYO unlisted shares also performed well and gave investors hope for a bright future. Based on the current growth in cash flow, OYO expects to achieve its target EBITDA of Rs 800 crore in FY24. In this blog, we will discuss OYO's plan to achieve this EBITDA.
Moody Expects OYO To Remain EBITDA Positive
The hospitality giant, OYO, is anticipated to end this quarter with a surplus cash flow of Rs 90 crore. During this, OYO recorded a surge in hotel bookings in Europe before the summer. In addition, it also witnessed a rising demand during the off–season from November to March in the last fiscal year. OYO's market share in India also increased compared to the last financial year. As a result, its impact can be clearly seen in the performance of OYO Pre-IPO shares.
Moody's Investors Service recently said that OYO would likely see its EBITDA be positive for the remaining FY24. In its report, Moody's also shared that the overall outlook of the OYO will remain stable, which is a positive sign for the company. There is also speculation that OYO's share price might increase in the coming months. The investors who buy OYO unlisted shares should closely monitor the company's performance in the remaining quarter of this financial year.
Sweta Patodia, Moody's Analyst and Assistant Vice President, said, "The rating affirmation reflects Moody's expectation that OYO remains on track to turn Ebitda positive, on a full-year basis, for the fiscal year ending 31 March 2024, supported by a strong demand recovery as well as its various cost reductions."
The recent forecast of Moody is based on the further demand in the hospitality business, which results in higher storefronts on the OYO's platforms and major cost reduction. Experts at Moody also believe that the company's stable outlook reflects that it will maintain adequate liquidity to support its business operation. Moreover, the company's positive cash flow also helps it to manage the rising demand in the next 12-18 months.
OYO's EBITDA In the First Half of the Financial Year 2023
The first half of the financial year 2023 has been profitable for OYO till now, as it reported a Gross Booking Value (GBV) of Rs 3.47 Lakhs. Compared to the last fiscal year GBV, OYO records a growth of 68.7% due to extensive travel demand. There is also an increase in Year-On-Year (YoY) of 24%, reflected in its revenue of Rs 2904.62 crore. During this, the overall losses of OYO narrowed down to Rs 747 crore in H1FY23.
Due to the growth in these financial figures, OYO maintains a positive EBITDA of Rs 62.93 crore compared to the EBITDA of Rs (-280 crore) in the same period of the last year. Currently, OYO unlisted shares are traded in the Pre-IPO market. Investors eagerly waiting for OYO's IPO will likely consider its EBITDA ratio, which is a crucial metric in determining the future value of OYO IPO shares. The total expenses of the OYO in FY23 also marginally increased from Rs 3333 crore to Rs 3630 crore. Despite high business expenses, OYO managed a positive EBITDA that supports its goal of achieving an EBITDA of Rs 800 crore in FY24.
OYO’s Expected EBITDA In the Second Half Of Financial Year 2023
In the second half of the financial year of 2023, OYO's overall revenue is expected to increase two times. The Gross Booking Value (GBV) of OYO can also increase this quarter, which will impact OYO's unlisted share price. As per the forecast, the adjusted EBITDA of the company in the second half of FY23 can reach up to Rs 182 crore.
In addition, OYO's Year-on-Year (YoY) growth rate can also increase due to high hotel booking demand. According to the addendum filed with the market regulator of India, OYO is likely to exit FY23 with a total adjusted EBITDA of Rs 245 crore. The high earnings of the company in H1FY23 till now are due to cost-cutting, improvement in operational efficiencies, and business expansion.
OYO's Future Plans To Achieve Targeted EBITDA
It might be challenging for an OYO to achieve an EBITDA of Rs 800 crore in FY24. There is no doubt that the company plans to accelerate the growth rate and EBITDA ratio. As per rumours, one of the major parts of OYO's plan is the launching of an IPO for Rs 8430 crore, which will include a fresh issue of equity shares aggregating up to Rs 7ooo crore.
However, there is no exact date for an IPO to be released from the company's side. OYO share price is expected to be higher largely depending on how the company manages its financials in the next fiscal year. Here are the expected plan of OYO to achieve the targeted EBITDA:
Target New Geographical Regions
One of the major reasons behind the growth of OYO's EBITDA is rising travel demands in its targeted geographical regions. The company will now target new regions, including domestic and international. Apart from this, OYO's next target will be to increase its listing in existing geographical regions.
Increase The Number Of Premium Hotels
In the virtual meeting, OYO disclosed that it will now focus on increasing the number of premium hotels. The reason is to work towards business expansion and achieve the targeted EBITDA in the least possible time. With the rising demand for premium hotels, the company will try to make hotels available at the best possible price than its competitors.
Plan To Bring Its IPO
Last year, OYO was set to launch its IPO, but it was delayed for specific reasons. SEBI rejected its proposal by advising to update the records and refile the IPO paper with revisions. Now, the company is focused on maintaining positive financials, including EBITDA.
OYO unlisted shares can be traded whose value depends on the market conditions. We can expect OYO's IPO to be released soon in the future. Investors can enjoy the long-term benefits and become a part of a company's growth by investing in OYO unlisted shares before its IPO.
Start Investing In OYO Unlisted Shares With Stockify
The EBITDA of OYO throughout the first and second half of the financial year was positive. It shows that a company has much growth potential to benefit you in the long run. Since there is no exact date for its IPO, you can invest in its unlisted shares with the help of Stockify.
We have experts that provide updated information on the company's financials. Here, you can check the updated OYO share price, EBITDA ratio, market valuation, and more. Apart from OYO, you can also invest in Pre-IPO stocks like Tata Technologies, CSK, Capgemini, and more. To buy unlisted shares, connect with us today!
FAQs
1- Is It Profitable To Invest In OYO Unlisted Shares Right Now?
The performance of the OYO Pre-IPO shares depends on the company's performance and market conditions. It is best to check the company's financials for making profitable investments.
2- What Is The EBITDA Of OYO In The First Half Of The Financial Year 2023?
OYO has a positive EBITDA of Rs 69.23 crore in the first half of FY23.
3- What Was The Overall Revenue Of OYO In The Last Year?
The overall revenue of OYO in the last financial year was Rs 5600 crore. For more info about the company, connect with us now.
4- Does EBITDA Affect The Price Of OYO Unlisted Shares?
EBITDA does not directly affect the price of OYO Pre-IPO shares. However, it is an essential metric that helps determine the estimated share value.
5- How Can I Buy OYO Unlisted Shares?
You can easily buy unlisted shares of OYO by using Stockify. We offer assistance to investors while buying Pre-IPO stocks.
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