oyo Q2 Results: IPO-linked Oyo reports Q2 EBITDA of Rs 56 crore according to financial data submitted to Sebi

New Delhi: Hotel chain Oyo has reported adjusted EBITDA of Rs 56 crore and reported losses of Rs 333 crore in its second quarter financial results submitted to SEBI, compared with Rs 414 crore in the previous quarter.

Oyo has submitted its second addendum to update its draft Red Herring prospectus with financial performance through the first half of fiscal year 2022-23.

SEBI had given Oyo permission to provide updated financial data before reviewing and ultimately processing the company’s IPO application.

According to the addendum, revenue for the first half of FY23 rose 24% year-on-year to Rs.2,905 crore. Adjusted EBITDA improved from a loss of Rs.280 crore in the first half of FY2022 to a profit of Rs.63 crore in the first half of FY23.

According to the results, its Q2 EBITDA grew eightfold to Rs 56 crore in the first quarter, driven by a 23% qoq increase in gross booking value per hotel in the second quarter to around Rs 4 lakh . Revenues of Rs 1445 crore were reported in the second quarter.

But the increase in EBIDTA wasn’t enough to make the company profitable at a net level. The company recorded a net loss of Rs 3.33 crore against the Rs 4.14 crore reported in the first quarter of FY23.

Monthly revenue per hotel, referred to as Gross Booking Value (GBV) per hotel, rose 69% yoy to Rs 3.48. Total GBV grew 33% to Rs 5,028 crore in the first half of FY23, according to the addendum .

Gross rents for Oyo’s European home ownership business remained almost flat, increasing just 4%. As of September 30, 2022, there were almost 80,000 vacation rentals compared to 74,000 on the same day last year.

While the company was able to keep hotel facades at similar levels as of June 30, 2022 as in previous filings, the year-over-year decline in hotels is proving to be worrying. The close of the first half of the financial year 23 shows the number of hotels at 12,546. The number was 17994 as of March 31, 2022.

“The decrease in the number of storefronts for our hotel business from 17,994 storefronts as of March 31, 2022 to 12,546 storefronts as of September 30, 2022 was largely due to actions we took to improve our GBV per storefront per month, including temporary disruptions Storefront operations operating at below average GBV per storefront per month and delivering an unsatisfactory customer experience,” Oyo explained in its addendum.

The gross booking value for Oyo’s hotel business rose 44% yoy to Rs.3,006 billion in the first half of FY23.

Personnel expenses represented the largest component on the cost side at 18% of revenues, followed by marketing expenses at 14% and G&A at 7% of revenues for H1FY23.

A person familiar with the company’s affairs said it needs to show another quarter of growing EBITDA for the market to assess whether this performance trajectory is sustainable.

“This will be the most important parameter if the company decides to launch its IPO in the first quarter of 2023. The overall market must also be conducive to start-up stocks that don’t seem popular right now,” the person added.

In September, Oyo had reported losses of Rs 2,140 crore from ongoing operations for 2021-22, down 48% from Rs 4,103 crore a year earlier, according to a supplement filed with Sebi.

The company said the first quarter of 2022-23 was its first quarter of positive EBITDA, although its losses were Rs 414 crore. Operating income for the first quarter was Rs. 1,459.3 crore.