According to a regulatory filing by the hospitality sector Oravel Stays Pvt. Ltd, which owns OYO Hotels Homes, has approved an increase in the latter's permitted share capital from Rs 1.17 crore to Rs 901 crore ahead of its IPO (initial public offering).

According to a filing with the Registrar of Companies (RoC), Oravel Stays approved the resolution to expand OYO's authorised share capital at an extraordinary general meeting on September 1.

The maximum amount of capital that a corporation can issue at any given moment is known as authorised capital.

The move comes ahead of Softbank-backed OYO's IPO, for which a draught red herring prospectus (DRHP) is scheduled to be issued in the coming months, according to sources.

In August, OYO secured more financing from Microsoft at a post-money valuation of $9.6 billion, paving the way for the IPO.

According to a regulatory filing, Microsoft Corporation invested almost $5 million in OYO through the issuing of equity shares and compulsory convertible cumulative preference shares on a private placement basis by the latter.

In July, it obtained $660 million from global institutional investors, including Fidelity Investments, through a term B loan to refinance and simplify its current borrowings.

According to reports, OYO has begun talks with investment banks such as JP Morgan, Citi, and Kotak Mahindra Capital to arrange its $1.5 billion public offering, which is expected to garner between $1.2-1.5 billion at a value range of $14 to 16 billion.

The company has switched from a minimum guarantee (MG) strategy to a revenue sharing model, as well as to an automated and simplified dues reconciliation with its hotel partners twice a week.

Softbank, Sequoia, Lightspeed Venture Partners, Hero Corporate, and prominent global consumer tech businesses including DiDi, Grab, and Airbnb have all contributed to OYO's previous fundraising rounds.