OYO Is In Talks With Apollo Global Management Inc. To Refinance A $660 Million Loan

Posted On November 10, 2023December 12, 2023

Softbank-backed OYO Hotels and Homes is in the limelight for refinancing a $660 million loan with Apollo Global Management Inc., a US-based global alternative asset manager. In 2021, the company secured $600 million in debt funding from global institutional investors, including Fidelity Investments, Apollo Global Management, and many others. This news is essential for those who have invested in OYO unlisted shares and are planning to buy the company’s pre-IPO stocks. It is crucial for investors to know everything about OYO’s refinance decision and how it will impact OYO share price. Stay tuned to this blog to know about it.

A Sneak Peek Into Business Model Of OYO

Retail investors must know about the business model of OYO before investing in its unlisted shares and making a wise decision. OYO business model depends upon the patrons who list their hotels or storefronts on its platform. So, it is a large base of customers who book accommodation at patron’s storefronts via the OYO platform.

The patrons monitor pricing and their storefront inventory, which helps them maximise their revenue generation potential via a dynamic pricing algorithm. Further, the distribution of storefront or inventory happens via D2C Channels on the platform through indirect channels with the third party. They also list their storefronts on the listing, where they offer a fixed subscription fee for the platforms.

OYO To Refinance A $660 Million Loan

OYO Hotels and Homes has decided to refinance its $660 million loan with Apollo Global Management Inc. As reported by Bloomberg, the company seeks more time to cut debt following a delay in its Initial Public Offerings (IPO). Initially, OYO planned to go public in 2021 but has delayed its share sale many times.

Oravel Stays Private, the parent company of OYO, seeks to extend the maturity to five years compared with the existing 2026 deadlines. One of the spokespersons for OYO said, “Due to an increase in profit, we regularly get approached for cheaper finance options, but the Board hasn’t approved anything, including preparing some portion.”

Major Reasons Behind OYO’s Decision To Refinance Loan

The discussion with Apollo came after the OYO reported its first annual profit. OYO was the first Indian unicorn to raise debt from foreign institutions, and during that time, the company offered generous terms and maintenance covenants. However, there is no final decision made by the company on refinancing terms.

OYO’s loan was traded at 101.50 cents on the dollar as per the data shared by Bloomberg report. It is said that OYO’s decision to extend the IPO has proven to be longer than expected. The founder of OYO, Ritesh Aggarwal, has been trying for years to release its IPO for the startup, which is 47% backed by Softbank.

OYO IPO Details

Once, OYO was valued at around $10 billion and seen as equivalent to India’s Airbnb. The company was said to have filed an IPO to raise Rs. 84.3 billion in its original effort to go public in 2021. However, the company has delayed its IPO to refinance its loan with Apollo Global Management Inc. But in the future, the company will surely go public to raise funds to expand its business operations. So, it is a golden opportunity for investors to buy OYO unlisted shares before the company goes public, and investors can get benefits like early access to OYO’s IPO shares.

Financial Performance Of OYO

Considering the company’s financial aspect, OYO’s performance has been great in the past five years. In 2023, its recorded revenue was Rs. 56017 Million, against Rs. 49052 Million in 2022 and Rs. 41574 Million in 2021. So, the company’s revenue has been increasing for the last three years, marketing a positive growth of the company.

To expand its business, OYO is shifting its focus from rapid growth to sustainable growth to make the company profitable in the long term. Currently, OYO-focused markets are India, South East Asia, and Europe Homes. In the future, it will also expand its presence in other significant countries.

Future Of Investing In OYO Unlisted Shares

Do you want to diversify your investment portfolio? OYO unlisted shares are your excellent option. The company has been performing well in its business and unlisted share market. Investing in OYO unlisted shares will offer you a high return on your investment and an opportunity to be a part of the company’s growth journey.

Also, OYO has not yet released its IPO, so early investment will bring more benefits to your investment. If you’re struggling to invest in OYO or other pre-IPO companies’ unlisted shares, connecting with the right stock broking platform like Stockify will make your trading experience hassle-free. The expert brokers at Stockify will guide you throughout the trading process and provide you with the necessary details of the company to help you make your decision. Connect with the experts today.