Moody's moves OYO parent Prism outlook to positive before IPO

what happened

Moody's Ratings has changed the outlook on OYO's parent, Prism, to positive from stable, while affirming the travel technology company's B2 corporate family rating. TradingView reports that the agency expects stronger earnings and free cash flow over the next 12 to 18 months, which should support lower debt levels.

For FY26, OYO's EBITDA more than doubled, rising to ₹2,630 crore from ₹1,080 crore in FY25. The company also generated positive free cash flow for the first time after several years of cash burn. Moody's expects EBITDA to reach around ₹3,000 crore ($315 million) over the next 12 to 18 months.

OYO plans to raise about ₹6,650 crore in an IPO, of which roughly ₹5,000 crore would repay debt. Moody's does not include the offering proceeds in its base-case forecast, given uncertainty about timing and execution. The largest shareholder, SVF India Holdings (Cayman), a SoftBank Group subsidiary, holds 40.04%, while founder Ritesh Agarwal holds 30.52%.

why it matters

For markets, the deal is a test of investor appetite for IPOs of fast-growing Asian technology companies with rising profits. For SoftBank Group, which controls the largest stake, a successful listing could serve as a benchmark for valuing the holding. The news concerns a single company, so its impact on the broader market is limited.

tags

instruments