Wealth Management Firm Acquires ₹100 Crore Stake in OYO’s Parent Company at ₹53 per Share
In a significant move that underscores the resilience of India’s travel tech ecosystem, Nuvama Wealth and Investment Limited has made a strategic investment in OYO, acquiring shares worth ₹100 crore in the company’s parent firm, Oravel Stays Limited. The transaction, executed at ₹53 per share through a secondary market deal, values the hospitality unicorn at approximately $4.6 billion and highlights the ongoing investor interest in the travel technology sector.
The share acquisition, facilitated on behalf of a cluster of family offices, represents more than a financial transaction. It signals a vote of confidence in OYO’s strategic direction and potential for growth, especially following the company’s recent financial turnaround and international expansion initiatives.
Sources close to the deal revealed that these shares are being offered by OYO’s early investors, presenting a unique opportunity for partial exits while potentially introducing new strategic stakeholders to the company’s capitalization table. The move comes at a critical juncture for OYO, which has been working to redefine its market position and demonstrate sustainable financial performance.
Key Developments and Financial Highlights
The investment arrives on the heels of several significant milestones for OYO. The company recently reported a net profit of approximately ₹132 crore in the first quarter of fiscal year 2025, a remarkable turnaround from the nearly ₹108 crore loss reported in the same quarter of the previous fiscal year. This financial recovery has been complemented by aggressive expansion strategies, including two notable international acquisitions.
OYO has secured two strategic international acquisitions that underscore its global ambitions. The company announced an all-cash transaction to acquire G6 Hospitality—the operator of iconic brands Motel 6 and Studio 6 in the United States—for $525 million. Additionally, they acquired Paris-based CheckMyGuest for $27 million, further expanding their global footprint.
The positive momentum is further validated by Moody’s Ratings, which upgraded OYO’s corporate family rating from B3 to B2, maintaining a stable outlook. This rating improvement reflects the company’s improving financial health and strategic positioning.
Market Dynamics and Future Prospects
Interestingly, while the current valuation of $4.6 billion represents a significant milestone, it remains considerably lower than the company’s peak valuation of $10 billion. Industry observers note that this more modest valuation might actually represent a more grounded and sustainable growth trajectory.
“The Nuvama Wealth investment is particularly noteworthy for the Tamil Nadu startup ecosystem,” said Rajesh Krishnan, a startup ecosystem analyst. “It demonstrates that investors are looking beyond metropolitan centers and recognizing the potential of innovative travel technology platforms emerging from diverse geographical regions.”
Discussions are already underway with other potential investors like Incred, who are exploring stake purchases at share prices ranging between ₹53-₹60, which could potentially push the valuation up to $5.2 billion.
Implications for the Startup Ecosystem
The OYO investment signals several critical trends for the Tamil Nadu startup ecosystem:
- Renewed investor confidence in technology-driven hospitality platforms
- Growing interest from wealth management firms in supporting innovative startups
- Potential for more sophisticated, strategic investment approaches beyond traditional venture capital
Conclusion
The Nuvama Wealth investment in OYO represents more than a financial transaction—it’s a testament to the resilience, innovation, and potential of India’s startup ecosystem. As OYO continues to evolve and expand, it provides a compelling narrative of entrepreneurial transformation and strategic growth.
