Oyo, the Indian budget hotel chain, has decided to delay its third attempt at launching an Initial Public Offering (IPO) until March 2026, following strong pushback from its top investor, SoftBank, and ongoing fluctuations in the broader market. SoftBank, which holds a significant stake in Oyo, is reportedly urging the company to hold off on its IPO until its financial performance improves, citing concerns over the timing and market conditions. This move marks a significant deviation from Oyo’s earlier attempts to go public, as the company had filed for an IPO in 2021 and again in 2023, only to pull back both times due to adverse market conditions.
The broader Indian market has been volatile, with India’s Nifty 50 index showing a modest 3% rise in 2025 but still trailing more than 7% behind its all-time high from October of the previous year. This market instability has caused several companies to delay their IPO plans. For instance, LG Electronics’ Indian unit postponed its IPO, and Ather Energy, a maker of electric scooters, scaled back both the size and valuation of its IPO in light of the uncertain market conditions.
Oyo’s founder, Ritesh Agarwal, has been eager to proceed with the IPO, primarily due to a $2.2 billion loan he took out in 2019 to increase his stake in the company. The loan was backed by SoftBank’s founder, Masayoshi Son, and the first repayment deadline was set for December 2024. However, sources close to the matter suggest that lenders may be willing to offer an extension on the loan repayment deadline if Oyo proceeds with the IPO in the near future.
Despite Oyo's previous IPO filings aiming for a much higher valuation of up to $12 billion, the ongoing market volatility and investor pressure have led the company to adopt a more cautious approach. Oyo is now expected to take a more measured route for its public offering, possibly adjusting its valuation expectations and offering terms to align with current market realities.
Neither SoftBank nor Oyo have publicly commented on the situation, but the delay underscores the challenges that high-growth companies in India are facing when trying to go public in a fluctuating market environment. While Oyo’s decision to push back its IPO may offer it more time to stabilize its finances, it also raises questions about the long-term strategy for the company’s growth and its ability to attract investor interest once the market stabilizes.
The delay also highlights a broader trend in the Indian startup ecosystem, where many companies are facing pressure to adjust their IPO timelines and expectations due to market uncertainties. With the market still in a state of flux, many investors are becoming more cautious, weighing the risks and rewards of investing in newly listed companies, which in turn affects the appetite for IPOs in the country. For now, it seems that Oyo, like many others, will have to wait until more favorable market conditions prevail before taking the plunge into the public markets.
