Oyo’s parent company Prism plans to reduce the fresh issue component of its proposed initial public offering (IPO) to up to Rs33.5bn ($354.6m).
The proposed fresh issue size is nearly half the previously planned Rs66.5bn, according to a Press Trust of India (PTI) report cited by The Economic Times.
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The revision follows continued cash generation and an improvement in the company’s balance-sheet position, which has reduced its capital requirements, sources told the news agency.
A person familiar with the matter was quoted as saying: “The original issue was sized before the company’s more recent financial performance came through. With cash generation remaining strong and the balance sheet improving, the funding requirement has come down, allowing the company to reduce the amount of primary capital it raises.
“The objective is to raise what the business needs while keeping the capital structure efficient. The plan is to repay the residual debt over the next two to three years through cash flows generated by the business.”
Oyo had previously planned to raise up to Rs66.5bn, including around Rs50bn earmarked for debt repayment.
Under the revised proposal, a substantial portion of the fresh issue proceeds is expected to be used to repay or prepay, in full or in part, certain borrowings.
Prism is progressing to the next stage of its proposed IPO after filing an Updated Draft Red Herring Prospectus (UDRHP).
For FY26, Oyo reported EBITDA of Rs26.3bn, compared with Rs10.8bn in FY25.
Ritesh Agarwal, who founded Oyo in 2013, holds a 30.52% stake in the company. SoftBank Group subsidiary SVF India Holdings (Cayman) is the company’s largest shareholder, with a 40.04% stake.
