BENGALURU (Reuters) – SoftBank-backed <9984.T> Oyo Hotels and Homes’ losses ballooned sixfold in the year to March, while its revenue more than quadrupled, a valuation report filed by the India-based hotel chain with local regulators showed on Monday.
The losses highlight a period of rapid expansion by Oyo into markets such as China, the United States and the United Kingdom, which has made the six-year-old startup one of the world’s biggest hotel chains by room count.
Oyo reported a net loss of 23.85 billion rupees ($332 million) in the year to March 2019, compared with a loss of 3.6 billion rupees a year earlier, according to the report filed with India’s ministry of corporate affairs. Revenue from operations surged to 64.57 billion rupees ($900 million) from about 14.13 billion rupees a year earlier.
Oyo said in a statement the report contained only “certain provisional financials” for the year ending March 2019. “These are not the final audited financials and the same will be issued later by the company along with the annual report that we issue every year.”
The report, prepared by a valuer in Gurugram, just south of New Delhi, said the financials for the year to March 2019 were unaudited and all figures were provided by Oyo’s management.
The growing losses at Oyo come as its major investor SoftBank struggles to raise funding for a second investment fund in the wake of the failed listing of office-rental company WeWork and amid questions about the path to profitability of other marquee investments like Uber <UBER.N>.
SoftBank, which has invested nearly $1 billion in Oyo through its Vision Fund, this month reported its first quarterly loss in 14 years, dragged down by an $8.9 billion hit at the Vision Fund.
Oyo’s operating expenses grew nearly five-fold year-over-year to 61.32 billion rupees, while total expenses hit 90.28 billion rupees, the report showed.
Gurugram-headquartered Oyo, valued at $10 billion, allows guests to book hotels through its mobile app and charges partnering hotels a fee on room revenue. It also franchises its brand and offers standardized amenities at hotels on its network.
(Reporting by Sachin Ravikumar; Editing by Rashmi Aich, Bernard Orr)