Bangalore: About a year ago, Oyo was not only the second most value-based internet set up, but had one of the largest employers among the country’s internet. At the last year’s end, Oyo staff count reached a mark of 30000 all over the world and 10000 in India. Currently, Oyo employs not more than 10000 people from all the markets, including India. Though there is a stunning shrinkage, the company is likely to outbuild more staff in the upcoming months and the demand is likely to be persistent towards getting weak, as people who are aware of the matter made this statement.
In an interview with Mint, Oyo founder and chief executive Ritesh Agarwal said that the company will continue to invest heavily in technology (which may affect a few jobs) but doesn’t anticipate any. The continuing Covid-19 pandemic has harshly affected the travel, tourism and the Hospitality sectors all over the world, but has impacted Oyo quite hard. In India, if you take away the occasional spikes at the time of long weekends, then you will witness no demands near pre- covid levels.
Though China has successfully controlled the virus, the continuing tensions between India and China’s put a doubt on the prospects of Oyo in a long term, especially in the world’s second-largest economy. The US and Europe are undergoing a second and a much bigger wave of Covid-19, which may partial overturn the nestling recovery in the Hospitality Business in those certain areas.
Just to confirm, the vaccine breakthrough news by Pfizer and Moderna has increased hopes that the commencement of the end of the pandemic is quite near, especially in the Western nations. Now stocks of Hospitality companies in the form of Mariott International have been doubled from the lows of April. Airbnb, which agreed on a down round in a valuation of April of $18 Billion, has since made a strong come back and is currently expected to document for an offering of an initial public that could give value to the form by $30 Billion.
Such events have given rise to the cause for the Positivity at Oyo, which has utilised the crisis to build a lighter firm with fat margins, a structure that is hoping to retain post the end of the pandemic. Though the demand is getting low, an ambitious target has been set to achieve earnings before taxes, depreciation, interest and amortization profitability by the end of December 2020 in India
Still, with Oyo experiencing an overall revenue drop in this financial year for the first time since the launch in 2013, its valuation books worth $10 Billion looks way more pricey. If the valuation comes to a steep drop and also when it comes to pass, analysts have studied that Agarwal could have calls from investors to pave way for a professional CEO.
Aggarwal did not buy the fact that the plan was ever taken into consideration by the investors of OYO. He further adds saying that there was no such discussion with regards to this. They have put their emphasis on building business and walking through the virus and recovering through the pandemic.