OYO, the global travel tech company, has marked a significant milestone by recording its first profitable year in FY24 with a net profit of Rs.100 crore. This achievement is a major turnaround for the company, which has been striving for profitability since its inception.
Financial Performance
In FY24, OYO expanded its global footprint by adding approximately 5,000 hotels and 6,000 homes. The company reported a Profit after Tax (PAT) of Rs.99.6 crore and an adjusted EBITDA of Rs.888 crore (USD 107 million), which represents a significant increase from the Rs.274 crore (USD 33 million) reported in FY23.
Revenue and Growth
OYO’s revenue from operations increased by 14% to Rs.5,463 crore in FY23, up from Rs.4,781 crore in FY22. The company also managed to narrow its losses to Rs.1,286 crore in FY23 from previous higher losses. The Gross Booking Value (GBV) reached nearly Rs.10,000 crore, with the hotel business contributing Rs.6,172 crore, a 35% y-o-y growth.
Strategic Initiatives
To increase its profitability, OYO implemented several initiatives. These included focusing on core markets, centralizing key functions, and optimizing costs to drive its growth to profitability. The company also rationalized its hotel network, reducing the number of hotels from 18,037 in FY22 to 12,938 in FY23, focusing on tech-enabled, monthly revenue optimization models.
Prospects and Expansion
Looking ahead, OYO plans to expand its presence in key international markets such as the US and UK. Founder and CEO Ritesh Agarwal emphasized the potential for growth in these regions, leveraging innovative tech like contactless check-in to enhance customer experience and get repeat customers.
Conclusion: OYO’s first profitable year in FY24, with a net profit of Rs.100 crore, marks a major milestone for the company. The company expanded globally, adding 5,000 hotels and 6,000 homes, and significantly increased its adjusted EBITDA to Rs 888 crore, showcasing effective strategic initiatives and market growth.
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