Oyo Eyes ₹1,000 Crore Funding from Prominent Indian Family Offices

Oyo is actively negotiating to secure over ₹1,000 crore from the family offices of some of India's most prominent corporate executives and stock market professionals. Potential investors in this funding round include Anand Jain, a well-known corporate strategy advisor, Ramesh and Rajeev Juneja, the promoter brothers of Mankind Pharma, and Utpal Sheth, a close associate of the late market expert Rakesh Jhunjhunwala, according to sources familiar with the matter.

Oyo Eyes for Funding

This strategic move comes shortly after Oyo withdrew its application for an initial public offering (IPO) last month. In a bid to facilitate the new funding, Oyo has scheduled an extraordinary general meeting (EGM) this week. During the EGM, the company plans to seek approval for expanding its authorized share capital, a necessary step to accommodate the incoming funds.

When Oyo IPO will come is a matter of time, but presently, the company is raising funds!

The proposed fundraising round pegs Oyo’s valuation at approximately $2.5 billion, a stark contrast to its peak valuation of $9 billion in 2021. This significant 72% decrease underscores the shifting market dynamics and the company's recalibrated strategy in the highly competitive hospitality sector. Despite the reduced valuation, Oyo continues to attract significant investor interest, particularly from Malaysia’s sovereign wealth fund, Khazanah Nasional. The inclusion of Khazanah Nasional is particularly notable, as it brings a layer of credibility to Oyo’s capital structure due to the fund's esteemed reputation.

According to reports, the order book from family offices has already reached around ₹1,000 crore. Oyo intends to allocate a portion of this fundraising to Khazanah Nasional, leveraging the fund's status to enhance investor confidence. The company is poised to approve an initial fundraising tranche of approximately ₹500 crore, with the full amount expected to be secured by the end of the month.

This latest funding effort represents a critical juncture for Oyo, as it seeks to stabilize and grow amidst a challenging market environment. By attracting investments from high-profile family offices and sovereign wealth funds, Oyo aims to bolster its financial position and drive its next phase of growth.

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