Oravel Stays, the parent company of OYO, is on the verge of achieving a significant milestone – reporting its first-ever profit after tax (PAT) in the second quarter of the fiscal year 2024. Founder and CEO Ritesh Agarwal shared this exciting news with the company's top management in an email.
In his message, Agarwal emphasized the importance of this year as OYO's 10th anniversary, making it a particularly momentous occasion. He revealed that based on the company's current trajectory, the second quarter of FY24 is expected to mark its inaugural profitable quarter, with a projected PAT exceeding Rs 16 crore.
In addition to celebrating this milestone, Agarwal discussed OYO's growth potential in key markets like the United States and the United Kingdom. He expressed confidence in these future growth markets and their commitment to enhancing customer confidence through innovative technologies like contactless check-in, tailored to meet evolving customer needs.
Agarwal also drew attention to OYO's recently released annual report for FY23, which highlighted several key achievements. During the previous fiscal year, the company generated revenue from operations totaling Rs 5,463 crore, representing a nearly 14 percent increase compared to the preceding fiscal year.
Furthermore, he pointed out that OYO successfully reduced its losses to Rs 1,286 crore for FY23. The company's Adjusted Gross Profit Margin improved to 43 percent of revenue, with Adjusted Gross Profit increasing by 23 percent to Rs 2,347 crore in FY23, up from Rs 1,915 crore in FY22.
Additionally, Agarwal discussed OYO's strategic decision to rationalize its number of hotels in FY23, reducing them from 18,037 to 12,938. This initiative was part of the company's efforts to optimize its hotel network, focusing on tech-enabled monthly revenue optimization.
Despite the reduction in the number of hotels, Agarwal highlighted that OYO maintained its position as the largest full-stack short-stay accommodation provider in terms of hotel footprint in India and Southeast Asia as of June 2023.
Agarwal also shed light on OYO's overall Gross Booking Value (GBV), which saw a substantial 25 percent increase, reaching approximately Rs 10,000 crore. Specifically, GBV from the hotels business amounted to about Rs 6,172 crore, indicating a remarkable year-on-year growth of 35 percent. The GBV per storefront on hotels displayed impressive growth, surging by 82 percent to Rs 3,99,000 in FY23, up from Rs 2,19,000.
