 "Oyo")
IPO-bound hospitality major Oyo on Tuesday elevated Rakesh Kumar to its new Chief Financial Officer (CFO). Before this, he was working as the firm's Deputy CFO.
Kumar will replace Abhishek Gupta, who will continue with Oyo in “an advisory and mentorship capacity.”
In his previous role, Kumar oversaw key financial functions at the company, including business finance for all markets, treasury, controllership, shared services, financial and investor reporting, taxation, and financial planning and analysis, the company said.
In his last six years at Oyo, Rakesh has played a pivotal role in the company's financial stability during the COVID-19 pandemic. His leadership facilitated successful equity and debt raises and strategic acquisitions. In his new role as the CFO, he will continue driving financial strategy and operational efficiency, the company said.
“I am honoured by the opportunity to step into the role of the Chief Financial Officer. My journey with Oyo has been marked by unique opportunities as well as interesting challenges. I appreciate the trust placed in me to navigate these complexities,” said Kumar, adding, “I am fully committed to leveraging this autonomy to strengthen our financial position and drive sustained success for Oyo."
Oyo recently initiated part prepayment of its debt through a buyback process. The company will repurchase approximately $195 million – around 30 per cent – of its outstanding Term Loan B (TLB) of $645 million due in May 2026, using internal cash.
Global credit rating agencies Fitch and Moody’s recently termed this move as positive. Fitch said that the move will improve Oyo’s EBITDA and that they may take positive rating action, while Moody’s expects Oyo to generate an adjusted EBITDA of around $90- $100 million for the financial year 2024, nearly doubling the EBITDA estimate from $50-55 million projected earlier this year (May 2023).
The IPO-bound hospitality major is expected to report its first-ever profit in the second quarter of the financial year 2023-24, with a profit after tax (PAT) of Rs 16 crore, the company’s Chief Executive Officer (CEO) Ritesh Agarwal recently revealed in an email to Oyo’s top management. The company, Agarwal said, achieved operational profitability in the financial year 2023, clocking an Adjusted EBITDA of Rs 277 crore.
