H World Group sells 19% of its total stake in Oyo in private market, makes a return of 500%

H World Group Limited, formerly known as China Lodging, has sold one crore equity shares in Oyo (Oravel Stays Limited) to a clutch of UAE-based family offices and institutional investors in a series of transactions, people familiar with the matter told ET. This translates to a 0.15% stake sale of H World Group on a fully diluted basis. Before the share sale, H World Group held a 0.78% shareholding in Oyo. The transactions, which were done in multiple tranches primarily over the course of 2022, have earned H World Group, over Rs 75 crore, the people cited above said. H World Group's partial exit translates to a return of 500% on the stake sale and values their residual stake at over Rs 300 crore. This implies a valuation of $6.6 billion for the hospitality tech unicorn, which has been attempting to list on the Indian stock exchanges. The last reported transaction of Oyo's equity shares in the secondary market was in October last year where the compam/s shares were picked up by some family offices at a valuation of S 6.6 billion. This indicates that the company/s valuation hasn't increased despite improved business performance in an environment of increased scrutiny on start-up valuation multiples. Post this transaction, H World Group will be left with a 0.63% stake in Oyo. Sources privy to the matter refused to divulge the names of the UAE-based buyers but said there has been an 'enhanced interest' in Oyo in the secondary markets since it refiled its DRHP with SEBI in March 2023.

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