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Oyo Reports Rs 158 Cr Profit in Q2 FY25, Sees Strong Growth in Premium Hotel Segment

• ByStartupStory     |    October 25, 2024

Oyo Hotels & Homes, a Gurugram-based hospitality company, reported a net profit of Rs 158 crore for the quarter ending September 30, 2024, marking a significant turnaround from the Rs 50 crore loss it recorded in the same period last year. This surge in profitability reflects the company’s intensified focus on premium offerings and expansion within its Townhouse brand, according to Founder and CEO Ritesh Agarwal.

“We are encouraged by our continued positive performance, driven largely by our strategy to focus on premiumisation,” said Agarwal. He highlighted that this shift was bolstered by the launch of company-serviced hotels under the Townhouse brand, along with other offerings designed to appeal to higher-spending customers.

The latest financial results extend Oyo’s positive trajectory from the previous quarter, when it posted a net profit of Rs 132 crore. The company’s cumulative profit for the first half of FY25 stands at Rs 291 crore, a sharp contrast to the Rs 91 crore net loss during the same period last year. These results are currently unaudited, with the company expected to file its official FY25 financials with the Registrar of Companies in the near future.

Revenue and Growth Metrics

For the September quarter, Oyo reported a gross booking value of Rs 3,243 crore, representing a 17% increase year-over-year. Revenue for the three-month period was Rs 1,578 crore. Agarwal expressed optimism about the company’s long-term growth targets, sharing with employees that Oyo is “on track to exceed Rs 2,000 crore in EBITDA by FY26.”

Recent Funding Round and Valuation

Earlier this year, Oyo secured Rs 1,457 crore in fresh funding from a range of investors, including domestic family offices and stock market players. The round valued the company at USD 2.5 billion—a sharp reduction from its peak valuation of USD 9 billion in 2021. The fundraising was led by an entity associated with Agarwal, contributing Rs 830 crore, while additional investments came from the family office of Mankind Pharma promoters, ASK Financial Holdings, and J&A Partners.

Expanding Global Reach with G6 Hospitality Acquisition

In a major international acquisition, Oyo acquired G6 Hospitality, a U.S.-based economy lodging franchisor and parent company of Motel 6 and Studio 6 brands, from Blackstone in an all-cash deal worth USD 525 million. This acquisition aims to strengthen Oyo’s global presence, particularly in the economy lodging market segment, where the Motel 6 and Studio 6 brands are well-established.

The acquisition represents a significant step in Oyo’s international expansion strategy, as the company looks to solidify its foothold in key markets around the world.

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