According to INC42, hospitality unicorn OYO, preparing for its IPO, achieved profitability in FY24 with a net profit of INR 229.5 Cr, a stark contrast to the previous year’s net loss of INR 1,286.5 Cr. Cost control measures, especially a reduction in employee expenses, contributed to this financial turnaround. OYO had previously announced its profitability in the prior month.

Despite the positive bottom line, OYO’s operating revenue remained largely flat at INR 5,388.7 Cr in FY24, down slightly by 1.3% from INR 5,463.9 Cr in FY23. Including other income, total revenue fell 1% to INR 5,541.5 Cr from INR 5,601.7 Cr the year prior. The company also saw significant growth in hotel numbers, increasing to 18,103 hotels by the end of FY24, up from 12,938 the year before. However, these new hotels have yet to fully impact revenue growth.

OYO’s total expenses decreased by 16% in FY24 to INR 5,725.7 Cr, down from INR 6,799.6 Cr in FY23. Employee benefit expenses dropped sharply by 52% to INR 744.3 Cr, with share-based expenses plummeting 71.3% to INR 180.6 Cr. Lease costs, which account for 46% of total expenses, fell by 8% to INR 2,629.5 Cr, while finance costs rose by 24%, reaching INR 843.8 Cr in FY24.

Looking ahead, CEO Ritesh Agarwal aims to triple OYO’s profit after tax (PAT) to INR 700 Cr in FY25. The company raised INR 1,457 Cr in a funding round led by Agarwal’s Patient Capital, bringing OYO’s valuation down to $2.37 Bn from its 2019 peak of $10 Bn. Despite plans for an IPO, the listing has been delayed, with sources suggesting the company is awaiting terms on refinancing a $660 Mn loan before proceeding.