OYO, a well-known company in the hospitality sector, is going to enter the stock market soon. The company’s parent firm Prism has made full preparations to launch an IPO of ₹ 6,650 crore. According to the latest documents submitted with market regulator SEBI, Oyo will spend a large part of the proceeds from this IPO, about 75 percent, in repaying its debt. The company is paying full attention to making its balance sheet strong and debt free so that investors can get a better and safer option as soon as they enter the market.
Oyo preparing to become debt free
Out of the ₹6,650 crore that the company will raise under the proposed IPO, a huge amount of ₹4,987.5 crore will be used only to lighten the burden of old debt. After this, the company will invest the remaining amount in its normal corporate operations. From the perspective of a common investor, reducing the debt of any company directly increases its financial stability. This step of the company is being considered as part of a well thought out strategy to ensure that the shares remain strong in the market after listing.
IPO size may decrease
The biggest feature of this IPO of Oyo is that it will be a completely ‘fresh issue’ i.e. new shares. This simply means that no existing shareholder of the company is selling his stake through the Offer for Sale (OFS) window. However, considering the market conditions, there may be a slight reduction in the final size of the IPO. The company is also considering doing a pre-IPO placement of up to ₹1,330 crore before the public issue. If this placement is successful, the size of the IPO will be reduced by the same amount.
Financial health of the company returned to profit
If we look at the company’s functioning and financial performance, Oyo’s health has seen a sharp improvement in recent times. During the first nine months of FY 2026 (April to December 2026), the company’s parent firm Prism has achieved operational revenue of ₹ 6,941 crore. During this period, the company’s net profit has increased by 11 percent on annual basis to ₹ 748 crore.
Apart from this, the company has also performed brilliantly at the operating level. In the financial year 2025, the company’s operating profit i.e. EBITDA more than doubled from ₹ 953 crore to ₹ 2,127 crore. Even if exceptional items, share-based payment expenses and other income are excluded, this figure still comes to ₹1,968 crore.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
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