Oravel Stays, the parent company behind the travel tech brand Oyo, is eyeing to clock Rs 100 crore in Q4FY24 profit after tax (PAT) and a 20 per cent revenue growth for FY24, according to informed sources.
These numbers were part of an internal review meeting between founder Ritesh Agarwal and senior management earlier this week, where he spoke about the company’s profitability trajectory and growth in business.
“In a review meeting with Oyo’s leaders, Agarwal said this 3X sequential growth in profit is a result of steady topline growth and improved user confidence,” said the source.In an email response to Business Standard, the company said, “This appears to be from an internal provisional discussion.
"We do not have any official comment to offer.”
After becoming net profitable since the second quarter of the current financial year, Oyo has been recording bottom-line growth each quarter.
The company had marked its maiden profitable quarter with a PAT of over Rs 16 crore in Q2FY24 after which it doubled its PAT to around Rs 30 crore in Q3FY24.
“Oyo will conclude the financial year with a 20 per cent revenue growth. In calendar 2023 alone, the company added about 5,000 hotels and homes each, many of which were going online for the first time.
"There’s still untapped potential for growth as more and more small hotels and homes embrace technology in the coming years,” said the source.
Recently, the IPO-bound company shared that it clocked Adjusted (Adj) EBITDA of Rs 750 crore in calendar year 2023 and expects to clock Adj EBITDA of Rs 1,000 crore in FY24, surpassing its earlier projected Adj EBITDA estimate of Rs 800 crore for FY24.
The company optimised its operating cost by 15 per cent in Q3FY24 compared to the same period. It last filed its Annual Accounts for FY23 and these updates are unaudited.
According to the source, Agarwal also reiterated the firm’s plans to focus on its international expansion.
“Oyo has focus on four regions — India, Europe, Indonesia and Malaysia.
"They are deepening their presence in Bali,” added the source.
Oyo recently secured a Rs 200 crore credit line from JP Morgan to fuel the expansion of the Oyo Accelerator Programme.
Launched in March 2023, the programme empowers over 700 hotels and over 85 small and first-generation hoteliers from across the country, enabling them to expand their business and achieve long-term profitability.
The company has also increased its focus on spiritual tourism, recently opening 65 properties in Ayodhya and announcing intent to open 50 homestays in Puri in Odisha.
The company’s target for 2024 is to open over 400 properties in spiritual destinations in India.
It is also focusing on opening Sharia-compliant hotels in Southeast Asian destinations such as Indonesia and Malaysia.
