Hospitality technology company PRISM, the parent of OYO, has filed updated Draft Red Herring Prospectus-I (UDRHP-I) with the Securities and Exchange Board of India (SEBI), planning a ₹6,650 crore fresh issue to repay borrowings. According to the UDRHP filed on Tuesday, the proposed IPO comprises a fresh issue of shares of up to ₹6,650 crore, with no offer for sale by existing shareholders. The company has earmarked ₹4,987.5 crore, or about 75% of the issue proceeds, for the repayment or prepayment of borrowings, with the balance used for general corporate purposes. The debt reduction plan comes as OYO seeks to strengthen its balance sheet ahead of its stock market debut. The company may also undertake a pre-IPO placement of up to ₹1,330 crore before the public issue, which would reduce the size of the fresh issue if completed. The IPO is being managed by Axis Capital, Citigroup Global Markets India, Goldman Sachs (India) Securities, ICICI Securities, SBI Capital Markets, JM Financial, InCred Capital and Intensive Fiscal Services.
The updated DRHP reveals a company increasingly dependent on foreign markets, with revenue from operations outside India climbing to 83.77% for the nine months to December 2025, up from 74.70% in FY23. The US alone contributed 27.07% of revenue in the latest period, more than India's 16.23%, with the UK and Europe making up 72.36% of total revenue. As per the filing, any slowdown, policy shift or demand dip in these markets hits OYO harder than a similar dip in India would, and the company cannot assure investors it will reduce this reliance. This concentration has grown with the G6 Hospitality acquisition and earlier expansion into European vacation-rental brands, both of which tie OYO's fortunes to discretionary travel spending in developed markets currently cycling through inflation and slower growth. The company's business mix has shifted sharply over the past two years following a series of overseas acquisitions, with the acquisition of G6 Hospitality making the United States its largest market, contributing more than 52% of global gross booking value during the nine months ended December 2025.
For the nine months ended December 31, 2025 (9MFY26), PRISM reported revenue from operations of ₹6,941 crore, exceeding the company's entire FY25 revenue of ₹6,259 crore. The company achieved a net profit of ₹748 crore for 9MFY26, compared with ₹245 crore in financial year 2025. EBITDA stood at ₹2,127 crore for 9MFY26, compared with ₹953 crore in financial year 25. EBITDA excluding exceptional items, share-based payment expense and other income stood at ₹1,968 crore for 9MFY26, 80% higher than the full FY25 figure of ₹1,095 crore. Total borrowings stood at ₹7,485 crore as of December 31, 2025. The proposed public issue is expected to value the company at around $7-8 billion, as previously reported by Moneycontrol. The company proposes to utilize ₹4,987 crore IPO proceeds towards repayment or prepayment of borrowings, which is expected to reduce the annualized cost of borrowings by approximately 25%, with that reduction flowing directly through to net profit.
The IPO filing reveals significant changes in PRISM's ownership structure, with existing shareholders maintaining their stakes through the listing. As per the draft prospectus, SoftBank remained the company's largest shareholder with a 40.04% stake, followed by Ritesh Agarwal, who held a combined 26.71% stake through RA Hospitality Holdings and in his personal capacity. The promoter group held 66.76% of the company ahead of the issue. Other major shareholders include the Oravel Employee Welfare Trust (5.39%) and Patient Capital, Five Stars Capital, Lightspeed, Airbnb and Peak XV Partners. The promoter pledge shows that the entire share capital of a key promoter entity has been indirectly pledged to secure a three-year external financing facility. The filing shows that Oyo founder Agarwal indirectly holds 100% of Preferred Hospitality Holdings (Cayman), or PHH, which has 100% ownership of RA Co, a classified promoter company that holds 3.19 billion shares in Oravel, representing a 20.12% stake on a fully diluted pre-issue basis. PHH entered into an external financing facility effective 30 October, 2025, with a tenure of three years, securing this arrangement by pledging 100% of the share capital of RA Co to DB International Trust (Singapore) Ltd, a subsidiary of Deutsche Bank AG.
The IPO filing reveals a long-running dispute with Zostel Hospitality that could have significant implications for the company's shareholding structure. As per the updated DRHP, the company signed a non-binding term sheet with Zostel Hospitality Private Limited for the potential acquisition of Zostel's business, which did not materialize. Zostel contended that while it had fully complied with all obligations outlined in the term sheet, PRISM did not take the requisite steps to finalize the acquisition process. PRISM disputed the claims in entirety on the ground that the term sheet was non-binding and was merely 'exploratory' in nature. While the arbitrator passed an award holding that the term sheet was binding in nature, PRISM challenged that finding before the Delhi High Court, which set the arbitral award aside on public-policy grounds. Zostel has since appealed to a division bench under Section 37 of the Arbitration and Conciliation Act, and if Zostel eventually wins a non-appealable order, PRISM may have to issue or transfer up to 7% of its shareholding or pay the equivalent in cash to Zostel and other parties.
Separately, S&P Global Ratings has revised PRISM's outlook to Positive from Stable, while affirming its 'B' issuer credit rating, citing improving profitability, stronger cash generation and the expected strengthening of the balance sheet following the proposed IPO. The filing also comes weeks after the Delhi bench of the Income Tax Appellate Tribunal (ITAT) quashed a ₹3,885 crore angel tax demand against the company, removing a significant tax overhang ahead of the proposed listing. Earlier this month, the company received SEBI's approval to launch its maiden public offering. The book-running lead managers to the issue are Axis Capital, Citigroup Global Markets India, Goldman Sachs (India) Securities, ICICI Securities, InCred Capital Wealth Portfolio Managers, Intensive Fiscal Services, JM Financial and SBI Capital Markets. The IPO is scheduled for listing on both NSE and BSE.
In India, PRISM has been expanding its company-serviced hotel business, where it has greater operational involvement through leasing or management service arrangements. Its India company-serviced hotel storefronts increased to 1,573 as of December 31, 2025, from 1,053 as of March 31, 2025. The gross booking value (GBV) of these properties stood at ₹1,346.45 crore for 9MFY26, about 65% higher than the full-year FY25 figure of ₹818.23 crore. Company-serviced hotels contributed 49.29% of PRISM's India GBV. As of December 31, 2025, PRISM's network comprised 24,303 hotels, 124,668 homes and 144,583 listings, including 14,937 storefronts in India. The company operates 43 brands across more than 35 countries and has served 119.36 million unique customers since its inception in 2012. According to the filing, around 67.6% of stays during 9MFY26 came through direct customer channels such as the company's apps, websites and corporate platforms, while repeat customers accounted for 61.8% of bookings. The company said it has a combined loyalty base of 26.4 million members across Oyo Wizard and My6 platforms. Accommodation services accounted for 55% of revenue in the first nine months of FY26, while booking commissions and royalty income contributed another 32%.
