Through The IPO PRISM: Is OYO Ready For The Spotlight? 

What’s in a name? Especially one that most people might not even utter.

Few people think of Zomato as a brand under Eternal even after the rechristening was seeded into our minds very early on, much before it became official. Eventually we will come to terms with Eternal too.

OYO changing the name of its corporate parent entity from Oravel Stays to PRISM could end up taking just as long to enter common parlance, if at all. But perhaps that’s missing the point behind both these changes.

The switch to Eternal was because Zomato was no longer just Zomato, and for Ritesh Agarwal-led OYO, the rebranding to PRISM is about emphasising the new multihued OYO — one that’s not just the three bold letters in red, but a global hospitality platform for work and leisure.

Just a visit to the new website indicates just how much of a shift the parent company is undergoing.

The user interface has a more sophisticated colour palette — the gold and gray reminiscent of many noted global hotel giants.

Coming on the eve of OYO’s third attempt at a public listing, the switch to PRISM is more than just a surface-level rebranding. As per sources and those in the know, the company plans to file its draft red herring prospectus (DRHP) by November 2025. This time, it is eyeing a valuation in the range of INR 58K–66K Cr ($7-8 Bn).

This after its first bid to raise $1 Bn from an IPO in 2021 was shelved and another confidential IPO filing in 2023 was withdrawn.

PRISM signals a new chapter for OYO’s parent entity after a period of austerity and cutbacks, restructuring of its debt, a transition to a different kind of a business model and a focus on premium experiences.

Inc42 has covered OYO’s initial turnaround in depth, where the company’s strategic focus on international markets and a diversified portfolio of brands had begun paying off.

And Agarwal & Co have continued this momentum in FY25 and FY26. In Q1 FY26, OYO posted revenue of INR 2,019 Cr, up 47% year-on-year, with nearly 2x growth in net profits to INR 200 Cr. It reported net profit of INR 244.8 Cr in FY25, up 7% from INR 229.6 Cr in its maiden profitable year in FY24.

The company claims to have consistently improved its bottomline in the last few quarters and with the IPO tides favouring profitable companies, this was a vital turnaround.

But now with a new identity and plans to list publicly, PRISM needs to be looked at in a new light — pun intended. Has OYO truly checked all the boxes in the run up to its IPO? Let’s dive in and see.

The Brand Stands Strong

Launched in 2012, OYO has travelled far from its budget hotel aggregator roots. Today, under its new corporate identity ‘PRISM’, it operates a global portfolio that includes SUNDAY, Palette, Clubhouse, Belvilla, DanCenter, Traum, G6, Innov8 and Weddingz among other brands.

But will public markets investors see its sprawling footprint as diversification or as complexity? It’s hard to gauge the sentiment right now because more disclosure will come.

But Sandeep Murthy, managing partner at Lightbox, believes that despite the complex business structure, there is strong recall for the OYO brand. It’s not clear if this goodwill will carry forward for PRISM .

“If they now have financial prudence, there will definitely be interest in taking a close look at the opportunity,” he said, adding that markets seem willing to accept even a path to profitability as opposed to demonstrated profitability.

If OYO does list, it will have to demonstrate that it can deliver on that path, said Murthy.

That’s a sentiment shared by Anil Joshi, managing partner at Unicorn India Ventures.

“I think now they are in a position to at least hit the market. Overall, the IPO sentiment in India is positive. The pricing, of course, will be market-driven, but even if there are corrections, the fundamentals at which OYO is now looking to get listed are far better than what they were much earlier,” Joshi told Inc42.

The financial net is one silver lining for PRISM, but there are still nuances around free cash flow, debt repayments and more which need to be considered. More clarity on this should come from the DRHP before the end of this year and it could well be that OYO aka PRISM have things under control, in which case, the question will come to the valuation.

Answering Valuation Questions

As with many new-age tech companies aspiring for IPOs, significant concerns remain on PRISM’s valuation and whether it is bloated given the highly diversified business and the relatively recent switch in OYO’s revenue model .

These concerns will need to be addressed by PRISM management in the run up to the IPO and in roadshows.

OYO’s last private valuation peaked at INR 83K–99K Cr ($10-12 Bn), but has since been marked down. What would be a fair public market range now?

Should investors benchmark it against Indian tech platforms like Zomato and Nykaa, or against global players like Airbnb and Booking,com? Or even against listed hotel giants such as Taj Hotels (IHCL), ITC or EIH, the parent company of Oberoi. Indeed, OYO even competes with WeWork as far as coworking goes.

More on this subject later, but for now, let’s focus on what PRISM will count on in terms of its valuation ask from the market. 

Revenue Shift

So what is a right benchmark for something like what PRISM is building, where OYO is just a sub-brand. And this question is further complicated when we consider that till just a few years ago, OYO was being valuated for its business model which centred around minimum guarantees to hotel partners.

This has been completely shunted out in favour of revenue-sharing with owners and a franchise model, which reduced its capital expenditure spending. It also added other revenue streams:

• Commissions: A 20–35% share on the gross booking value of each stay.
• Subscriptions and Service Fees: Monthly payments by hotel partners for access to OYO’s technology stack, operational support, branding, and staff training.
• Leases and Franchises: In select geographies, OYO leased or directly operated properties.
• Technology Licensing: Its proprietary property management system (PMS) was offered as a SaaS product.

Revenue diversification is a strong point for OYO in its bid to justify the valuation.

Global Scale And Expansion

The second pillar that OYO or PRISM can rest its valuation on is the rapid global expansion, which began in 2017 and has today spread to over 80 countries. OYO claims its among the top three hotel chains in the world based on this global presence.

China proved to be the most ambitious bet. Within two years of its entry in 2017, OYO became the second-largest hotel chain in the country, and in 2018, it had more rooms in China than in India.

Localisation Was Key

Chinese talent in leadership roles, decentralised operations, and market-specific product tweaks helped OYO embed itself so well that many customers believed it was a domestic brand.

“This aggressive push was powered by a single idea OYO called the “99% market” — targeting budget-conscious travellers in tier-2 and tier-3 cities that legacy hotel chains had long overlooked. Standardisation at scale became its passport to global relevance,” said an analyst from PanScience Innovations, an Indian deep-tech & AI venture studio.

As the company scaled geographically, its business model also evolved in parallel. What started as a straightforward budget hotel aggregator grew into a broader hospitality ecosystem — spanning self-operated “neighbourhood hotels,” co-living, co-working, weddings, and premium vacation rentals. Each format was designed to capture a different slice of consumer demand.

So far, OYO has completed 15+ acquisitions, both in India and internationally. Notable names include Leisure Group (Germany), Direct Booker (Croatia), Bornholmske (Denmark), CheckMyGuest (France), G6 Hospitality (US), and MadeComfy (Australia), as well as Innov8 and Weddingz in India.

But the pursuit of scale came at a steep cost. In FY20, OYO reported losses of INR 13,123 Cr, fuelled by its minimum guarantee fee model that committed payouts to hotel partners regardless of occupancy. When Covid-19 hit in 2020, travel froze overnight, amplifying the crisis for a company already bleeding cash.

The existential threat forced a pivot away from “growth at all costs” and into a new era of operational discipline and profitability focus. strengthened through the acquisitions of Leisure Group and Direct Booker.

As Joshi notes, “They are working very hard, continuously improvising, improving top-line growth, and entering new markets. This is certainly expected to reflect in their profits. While some of this may already be disclosed in their prospectus, the actual performance will likely take a few quarters to materialise.”

Today, geographical presence and portfolio diversity is a major strength for PRISM and the reliance on OYO as a brand as reduced. This is arguably a big reason for the name change and a new identity.

“You have to understand, until a few years back, the brand name OYO was the sole identity for Ritesh’s company. But now, they have better operating brands such as Belvilla, DanCenter and G6, which have a higher brand recognition across the world, so the identity change was inevitable,” a former senior OYO executive said on the condition of anonymity.

Has OYO Earned Investor Trust?

With OYO embarking on the IPO leg, the focus now shifts to credibility.

According to discussions with analysts and investors, a tech-driven platform is just as essential as having several hotel brands.

While PRISM has several brick-and-mortar brands and properties, its real strength lies in its tech-driven model. By integrating AI and smart solutions for guest management, the company can reduce operational costs and improve earnings. “The earning potential of OYO is far better than that of any standalone hotel chain, provided they adopt tech solutions early and effectively,” Unicorn India’s Joshi said

While cost efficiency will undoubtedly be closely watched, rebuilding trust takes more than numbers. Investors will also want to make sure that there is transparency in how the business operates and how revenue is recognised across various geographies. Running a multinational hospitality chain involves several supply chain and talent complexities that may not be evident on paper.

“Memories are short and OYO has been out of the news for a while, so they have a great opportunity to come back to the spotlight with a new energy,” added Lightbox’s Murthy.

Investor trust also comes from knowing exactly where the company — in this case PRISM — falls in the broader market. We touched on the market benchmark for PRISM earlier and how its diversified business makes it harder for investors to pinpoint the right counterparts and analogs in the market to evaluate PRISM.

For Murthy, OYO’s revenue and cost drivers make it look more like Marriott than a consumer tech company or a hospitality platform. “Booking and Airbnb don’t own their inventory, while OYO is responsible for the rooms and the management of it. This places it in a zone much more like Marriott than a transaction platform,” he added.

From this perspective, OYO straddles a unique position. While it leverages technology like a consumer platform, the responsibilities and operational control it maintains over its inventory make it more comparable to a traditional hospitality operator.

Joshi added, “A smart investor will certainly view OYO from a global perspective, while some may look at it purely from the India opportunity. In any case, OYO will have a better delta because the company’s performance will be driven not by a few investors but by the overall investor base. A conservative approach is not bad, but it doesn’t capture the full picture.”

So is PRISM aka OYO expected to be a long-term investment story? The answer as investors say lies in the details and what transpires in the months before OYO’s potential listing. With the global geopolitical situation changing on a near daily basis, some uncertainty can be expected. So a lot could change for OYO — or should we say, PRISM —  between now and then.

Edited by Nikhil Subramaniam