Oyo IPO 2026: Third Time’s the Charm for $8B Valuation & Rs 6,650 Crore Raise?

Third time's the charm? Oyo files for 6.7k crore IPO

It’s do-or-die time for one of India’s most talked-about—and controversial—unicorns. Oyo, the hospitality disruptor that once promised to ‘standardize’ budget hotels across the globe, is making its **third serious bid to go public**. In a move that has reignited market chatter, Oyo’s parent entity, **Prism Group**, has confidentially filed draft papers with the Securities and Exchange Board of India (SEBI) to launch an initial public offering (IPO) of up to **Rs 6,650 crore** ($800 million), targeting a post-listing valuation between **$7–8 billion** .

This isn’t just another startup IPO filing. It’s a high-stakes redemption arc for founder Ritesh Agarwal and his team, who’ve faced intense scrutiny over Oyo’s business model, profitability, and global retreats. With the filing confirmed for early 2026, the question on everyone’s mind is: **Is this third time truly the charm for the Oyo IPO?** Or will history repeat itself?

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Oyo IPO: The Journey So Far

Oyo’s path to the public markets has been anything but smooth:

  • 2019: First IPO attempt shelved due to global market volatility and investor concerns over unit economics.
  • 2021: Second attempt withdrawn after the company’s U.S. IPO filing with the SEC was met with lukewarm interest and questions about its aggressive expansion losses .
  • 2022–2024: Period of strategic retreat—exiting unprofitable markets (China, U.S.), reducing staff, and refocusing on India, Middle East, and Europe.

Now, in 2026, with a leaner operation and improved financial metrics, Oyo is betting that the Indian equity market—riding high on domestic IPO success stories like IRFC and LIC—will finally embrace its comeback.

Inside the 2026 IPO Plan: Key Details

According to the confidential draft red herring prospectus (DRHP) submitted to SEBI, here’s what we know:

  • Issuer: Prism Group (formerly Oravel Stays Ltd), Oyo’s Indian holding company.
  • Issue Size: Up to **Rs 6,650 crore** via a **fresh issue of equity shares**—meaning all proceeds will go to the company, not existing shareholders.
  • No Offer for Sale (OFS): Founders and early investors like SoftBank Group, Sequoia Capital, and Lightspeed are **not selling** their stakes, signaling long-term confidence .
  • Valuation Target: $7–8 billion, down from its $10 billion peak in 2019 but still a premium to many listed peers.
  • Lead Managers: Goldman Sachs, JP Morgan, and Kotak Mahindra Capital are reportedly advising on the deal .

Why Now? The Strategic Timing of the Filing

Several factors align to make 2026 an opportune window:

  1. Strong Domestic Market Sentiment: Indian IPOs have seen robust retail and institutional demand, with many listings listing at significant premiums.
  2. Post-Pandemic Travel Boom: Oyo reported its **first full-year operational profit in FY2025**, driven by a surge in domestic and international leisure travel .
  3. Geopolitical Shifts: Reduced reliance on China and the U.S. has de-risked the business model in investors’ eyes.
  4. Government Push: The “Make in India” and “Startup India” initiatives create a favorable policy backdrop for homegrown unicorns.

Can Oyo Convince Investors This Time?

Skepticism remains. Critics point to lingering challenges:

  • Asset-Light Model Risks: Oyo doesn’t own most of its properties, making quality control and margin sustainability difficult.
  • Intense Competition: From MakeMyTrip’s budget chains to new entrants like Stanza Living, the budget hospitality space is crowded.
  • Profitability Depth: While Oyo is operationally profitable, sustaining it during economic downturns is unproven.

However, Oyo’s defenders highlight its **tech-driven platform**, **brand recognition**, and **scale across 25+ countries** as defensible advantages [INTERNAL_LINK:indian-unicorn-ipo-success-stories].

Market Reaction and Valuation Questions

Analysts are divided on whether the $7–8 billion valuation is justified. For context:

  • Indian Hotels Co. (Taj) trades at ~$8 billion market cap with vastly superior assets and global luxury presence.
  • Oyo’s projected FY2026 revenue is ~$1.5 billion, implying a price-to-sales ratio of 5–6x—high for a company with thin margins.

“The market will reward Oyo for its growth, but penalize it for its history,” noted a senior analyst at a Mumbai-based brokerage .

What This Means for India’s Startup Ecosystem

A successful Oyo IPO would be a massive morale boost for India’s startup ecosystem. It would prove that even companies with rocky pasts can mature, adapt, and win public market trust. Conversely, another failure could dampen IPO enthusiasm for loss-making tech firms, pushing more founders toward private funding or strategic exits.

Conclusion: A Pivotal Moment for India’s Unicorn

The Oyo IPO in 2026 is about more than just raising capital. It’s about redemption, resilience, and redefining what it means to be a successful Indian startup in the public eye. With a clear strategy, improved fundamentals, and a supportive macro environment, Oyo’s third attempt has its best shot yet. But as the old adage goes: third time’s the charm—or the final nail in the coffin. All eyes will be on SEBI’s approval and the eventual book-building process.

Sources

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