OYO Unlisted Shares:
Turnaround Story or Overpriced Optimism?
By Kanishk Devbangia, NISM Series XV Certified Research Analyst (NISM-202300182946)
1: The Business — What OYO Actually Does Today
OYO is not the highly aggressive, money-losing platform that it used to be from 2016 to 2020. OYO has been completely transformed in terms of both its business model and financial structure. Getting a sense of where OYO currently stands, not where it was at its best, is where an objective assessment needs to begin.
The Platform Model
OYO functions as a two-sided tech platform. On the supplier side, OYO collaborates with independent, unbranded hotel proprietors known as Patrons, providing them with technology infrastructure, revenue management services, dynamic pricing software, and distribution capabilities via the OYO booking portal. On the customer side, OYO provides consumers with standardized accommodation services within each price segment.
With its asset-light model, OYO does not have physical ownership of the assets it hosts on its platform. The business generates revenue mainly from commission fees and technology service charges from its Patron base. The benefit of such a business model is minimal capital requirements. However, the challenge lies in ensuring that OYO continues to provide an attractive value proposition to its Patrons.
Portfolio Premiumisation
OYO has purposely moved up the value chain ladder. The Palette Resorts range is geared towards high-end leisure customers, whereas the PRISM brand, which is currently repositioned as the parent brand of Oravel Stays, represents a wider move away from budget hotels. The company has increased its total number of hotels to 18,103 as of March 2024, from 12,938 in the previous year, with the latest batch featuring better-quality, high ADR hotels.
2: The Financials — A Real Turnaround, With Important Caveats
OYO's financial trajectory over FY22–FY25 is genuinely impressive. But investors in the unlisted market must look carefully at the quality of the numbers, not just the headline direction.
The Three-Year Financial Arc
The headline story is clear: OYO turned PAT-positive in FY24 after years of losses, and FY25 saw net profit grow approximately 172% year-on-year to ~₹623 crore. Adjusted EBITDA reached ~₹1,132 crore in FY25, reflecting 10 consecutive EBITDA-positive quarters — a milestone that management has highlighted as evidence of structural, not cyclical, improvement.
Numbers Should Be Read Carefully
This is not all cash, and the investors should be aware of the difference. A part of net profits made during FY24 were derived from non-operating activities – fair value gains and debt restructuring. Operating free cash flow improved during the period in question; however, the numbers are still not backed up by an independent audit of a DRHP level.
Revenues have stayed at roughly the same level during FY23 and FY24 and then started growing again in FY25. There is an intentional strategy involved here: OYO decided to reduce the size of its Patron network and get rid of those hotels that had a lower quality, which meant short-term revenue losses in return for better financial performance in the future.
The Debt Question
OYO carried significant debt from its hyper-growth phase. The company has actively managed this — buying back $195 million of debt and working to extend maturities to 2029. The debt trajectory is in the right direction, but at ~14% interest rates on the remaining obligations, it continues to consume a material share of operating profit. Prospective unlisted investors should treat the debt position as a live risk factor, not a resolved one.
3: The Unlisted Share Market — What the Price History Tells You
Understanding where OYO's unlisted share price has traded — and why it has moved — is essential context for any investor considering a position today.
The Price Journey
As seen from the chart above, the pricing trend in the unlisted market was a classic example of event-driven pricing. The rapid ascent to ₹55-67 in late 2025 was driven almost exclusively by IPO expectations and the news that the company would become PAT-positive. When the IPO was deferred because of opposition from SoftBank and concerns regarding filing of DRHP, there was a swift correction in the unlisted prices.
Here lies the major risk with the OYO unlisted stock. It is extremely event-dependent. In case of an actual IPO of the company at $7-8 billion valuation target, investors who buy at the current price of ₹21-27 would earn significant profits. However, in case of any further delays in the IPO or under-pricing of the same, the unlisted stock would remain cheap and difficult to dispose.
4: The IPO Question — What Is Actually Happening?
An analysis of the OYO unlisted shares would be incomplete without taking into consideration the status of the upcoming IPO of the same.
A Timeline of Delays
In March 2023, OYO registered a pre-filed DRHP with SEBI, aiming at an IPO size of about ₹8,430 crore and valued at ~$12 billion. However, that IPO did not happen. In late 2025, there was news of another DRHP registration in the name of OYO with an aim to go public at a valuation of $7 to 8 billion in early 2026. According to reports in May 2026, this IPO plan has been further delayed as well. The company's largest institutional investor, Softbank, allegedly is unable to align with the proposed time frame and valuation of the IPO.
Promoter Activity: A Signal Worth Watching
There are certain indications in favor of the future listing of the company. For example, founder Ritesh Agarwal himself has acquired almost ₹550 crore worth of OYO shares at around ₹42.60 per piece. The buy-in by a key insider is a clear positive signal that indicates the intention to see his company being listed at a valuation higher than the existing unlisted value.
5: The Investment Framework — Turnaround Story or Overpriced Optimism?
Where does this leave you as an unlisted shareholder of OYO then? The truth of the matter is that OYO is neither a clear-cut buy, nor a straightforward avoid; it is a conviction-driven trade that demands clarity regarding your investment guidelines before jumping into the fray.
The Bull Case for OYO Unlisted Shares
At around ₹21–27 per share, OYO is valued at around $1.8-$2.0 billion, which is highly undervalued relative to its $7–8 billion IPO valuation goal and even undervalued compared to its last valuation of $2.37 billion from the Series G down round in August 2024. Should it be able to float at anything near its targeted valuation, then early investors will make huge gains in their investments.
In terms of business fundamentals, for the first time in OYO's lifetime, everything is pointing towards the right direction – profitability, growth of EBITDA, growth of inventory, and commitment from the founder.
The Bear Case
The basis of the bear thesis can be stated simply – OYO has been announcing its IPO since 2021 and hasn't pulled through yet. Every additional postponement of the listing reduces the urgency premium built into the valuation of its stock. There is no certainty that the company will go public even in 2026 or 2027, let alone later.
The profitability theme is genuine but nascent. Two consecutive years of EBITDA profitability and a single year of net income are insufficient to claim that the company has established itself as a consistently profitable entity. The same goes for the management and capital structure issues.
Disclaimer:
This is written for educational and informational purposes only. Nothing here constitutes investment advice or a recommendation to buy or sell securities. All data is sourced from publicly available information. Investments in securities markets are subject to market risks — please read all offer documents carefully before investing.
