PRISM, the parent company behind the global hospitality brand Oyo Hotels (formerly Oravel Stays), has filed its updated draft red herring prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). The company aims to raise up to Rs 6,650 crore through an entirely fresh issue of shares, with no offer for sale by existing shareholders.
However, despite this significant development and a notable improvement in its financial performance, PRISM's unlisted shares in the pre-IPO market have shown little to no upward movement. Currently, these shares are trading in the range of Rs 22-24, a decline from the Rs 28-30 range seen earlier this year, according to market dealers.
Financial Turnaround and Business Pivot
The IPO filing highlights a strong financial turnaround for PRISM. For the first nine months of fiscal year 2026 (9M FY26) ending December 31, 2025, the company reported a profit after tax of Rs 748.34 crore. This marks a significant recovery from a loss of Rs 1,286.52 crore in FY23, and shows substantial growth over profits of Rs 244.82 crore in FY25 and Rs 229.58 crore in FY24. Revenue from operations also saw an increase, reaching Rs 6,941 crore in 9M FY26, surpassing the full-year FY25 figure of Rs 6,259 crore.
Sandip Ginodia, CEO of Altius Investec, noted that PRISM has successfully pivoted its business model from a low-cost service provider and aggregator to a high-margin hospitality player. This transformation involves expanding into multiple international markets, including the US, Dubai, and Europe, with diverse offerings. "With the pivot in its business model, the company is moving from volume to value but it will be a big challenge for the company. The customer will be looking at the big value proposition that it offers in comparison to its peers in the same cost as the market is very much competitive globally," Ginodia stated.
Why Unlisted Shares Remain Flat
Market experts attribute the subdued performance of unlisted shares to several factors. Hitesh Dharawat, Co-founder of Dharawat Securities, explained that there is currently ample supply and float of PRISM shares in the pre-IPO market, dampening any immediate price surge following the IPO announcement. He also stressed the importance of consistent profitability over a longer period to build sustained investor confidence.
PRISM plans to utilize Rs 4,987.5 crore from the net proceeds of the IPO primarily for the repayment or prepayment of borrowings, with the remaining funds allocated for general corporate purposes. Notably, key existing shareholders, including founder Ritesh Agarwal, SoftBank, Microsoft, and Airbnb, are not selling their stakes in this issue.
Global Footprint and Future Outlook
As of December 31, 2025, PRISM operates as a technology-driven hospitality platform with 43 brands across more than 35 countries. Its portfolio includes 24,303 hotels, 124,668 holiday homes, and 144,583 listings, having served 119.36 million unique customers since 2012.
The company has been expanding its company-serviced hotel business in India under brands like Sunday and Townhouse. In the US, the acquisition of G6 Hospitality (operating Motel 6 and Studio 6) has become a significant growth driver. European homes and listings also saw substantial growth, increasing to 269,251 from 208,901, primarily through brands such as Belvilla and DanCenter.
Further bolstering its financial health, S&P Global Ratings revised PRISM's outlook to positive from stable in June 2026, while affirming its 'B' issuer credit rating, citing improving profitability and stronger cash generation.