OYO Projects Robust EBITDA Growth Post Motel 6 Acquisition

OYO, a travel tech platform, is forecasting its EBITDA to surpass Rs 2,000 crore by 2025-26. The integration of the Motel 6 chain is expected to contribute significantly, adding Rs 630 crore to its EBITDA in the coming fiscal year. OYO plans to acquire Motel 6 for USD 525 million, utilizing a combination of debt and equity.

OYO, the travel technology unicorn, is anticipating its EBITDA to exceed Rs 2,000 crore by the financial year 2025-26. The substantial growth projection comes with the integration of the Motel 6 hotel chain, which is expected to add over Rs 630 crore to the company's EBITDA in the upcoming fiscal year.

The travel tech giant plans to refile its initial public offering (IPO) papers with the Securities and Exchange Board of India (SEBI) after refinancing a USD 450 million Term Loan B at a lower interest rate. The announcement follows OYO's acquisition of Motel 6 and Studio 6 from Blackstone Real Estate for USD 525 million in an all-cash transaction.

According to the company's parent, Oravel Stays, the acquisition will be financed through a mix of debt and equity. OYO aims to leverage USD 250 million from recent fundraisers and existing cash reserves. The strategic acquisition will bring the total number of OYO hotels to nearly 20,000, significantly augmenting its topline revenue.

(With inputs from agencies.)