Rohit Kapoor, Global Chief Marketing Officer at hotel booking aggregator OYO, has reportedly quit the company. He joined the company in 2018 as CEO of the new real estate businesses after working with Max Healthcare as Executive Director. He took on his current role in April 2022, after Ankit Gupta was elevated as CEO of OYO India.
Rumours are rife that Kapoor will join Swiggy as the CEO of its food delivery business, though neither OYO nor the food delivery unicorn chose to comment on this. Interestingly, Kapoor's expected entry into Swiggy comes when other senior executives quit the food delivery start-up. Its COO, Vivek Sunder, exited last year, while Shivcharan Pulugurtha, Senior VP–Business, resigned Swiggy this year to join Tata Digital.
What's Going On At Oyo?
As of December 2021, OYO has established its presence in over 10,000 cities in 35 countries with around 159,000 properties. This is a huge step up from its 2015 footprint in 127 cities across 1,229 outlets in India and its first international foray in Malaysia.
In January 2022, OYO Hotels Founder & Group CEO Ritesh Agarwal said the company's 2021 bookings were the highest among 90 pandemic weekends since April 2020.
Eyeing an IPO, the company filed its Draft Red Herring Prospectus (DRHP) on September 30, 2021, wanting to raise $1 billion at a $10 billion valuation. Its filing with the Security And Exchange Board of India (SEBI) outlined how its business suffered due to pandemic-related travel restrictions, which latest through 2020 and did not reverse until the second quarter of 2021.
As per DHRP documents, OYO has 21 cases registered against its subsidiaries, directors and promoters. It includes petitions filed by the Federation of Hotels and Restaurants Association of India against Oyo for dominating the online travel agents (OTA) market and by Treebo Hotels and Zostel Hospitality, respectively. In the last three financial years, Oyo has reportedly spent nearly Rs 1,166 crore on legal and professional fees.
At the start of 2020, the New York Times reported that former OYO employees alleged a "toxic" work culture in the company, which dealt a blow to the start-up's public image. Around this time, several hoteliers, former and current employees also alleged that the hotel aggregator offers rooms from unavailable hotels or those from unlicensed hotels and guesthouses, provides free lodging to government officials and delays payments to its hotel partners. Though OYO denied the allegations, these practices had raised the hackles of employees and its hotel partners.
Last year, OYO raised debt funding worth $660 million from global institutional investors, including Fidelity Investments. The hotel aggregator planned to use these funds to retire its past debts, strengthen the balance sheet and leverage the funds for other business purposes, including investment in product technology.
The pandemic forced OYO to stop expansion in Latin America after its biggest investor SoftBank exited the joint venture in the region. In 2021, it restructured its global business under three units; OYO INSEA (India and South-East Asia), including India, Indonesia, Malaysia and the Philippines; Oyo Europe, and OYO International.
According to a Bloomberg report, the Softbank-backed start-up decided to shelve the IPO till 2023 following discussions with its bankers, who pointed out that the timing for a public listing was not viable. Earlier this year, OYO recently requested permission from SEBI to update its IPO prospectus with newer financial results.
