New Delhi: The question of whether OYO might follow the same troubled path as BYJU’S, rapid growth followed by serious financial trouble, has been on a lot of minds in 2024. Both companies have had dramatic ups and downs, but their recent stories couldn’t be more different.
OYO: A Comeback in the Making
In FY24, OYO made a big turnaround, reporting a profit of ₹229.5 crore after losing ₹1,286 crore the year before. How? Mostly by cutting costs, like reducing employee expenses by 52%. While that’s great news, their revenue dropped slightly by 1.3%, showing they still need to figure out how to grow their business while staying profitable.
They’ve also added over 5,000 new hotels to their portfolio, now managing 18,103 properties. But these new additions will take some time before they start bringing in good money. Overall, OYO’s strategy of cutting unnecessary spending seems to be paying off, with their total costs dropping by 16%.
BYJU’S: A Tough Spot
BYJU’S, on the other hand, is in serious trouble. They’re facing investigations over how they’ve been handling their finances, with questions about possible fund misuse or misreporting.
The company, once valued at $22 billion, has seen its worth crash to almost zero. Founder Byju Raveendran has admitted they’re in survival mode, fighting legal battles and trying to regain investor trust.
Two Very Different Stories
OYO and BYJU’S are taking very different approaches to handling their problems:
- Profits vs. Growth: OYO focused on cutting costs and turning a profit, and it’s working. BYJU’S focused too much on growing fast and is now dealing with the fallout.
- Winning Back Investors: OYO’s improvement might help restore faith as they prepare for an IPO. BYJU’S, meanwhile, has lost a lot of investor trust, with some giving up hope entirely.
- Managing Operations: OYO’s smart spending shows they’re getting their finances under control. BYJU’S messy management and lack of transparency have left people doubting their future.
