PRISM Withdraws Oyo Bonus Plan After Investor Backlash

PRISM, the parent company of Oyo (formerly Oravel Stays), has withdrawn its controversial bonus share proposal after facing strong criticism from investors over its complexity and perceived unfairness.

The earlier plan, described by analysts as one of India’s most convoluted corporate actions, introduced a two-tier structure that differentiated between shareholders based on their response time and Oyo’s IPO progress before March 2026.

Under the withdrawn resolution, investors who responded within a short election window (“Class B”) stood to gain far more than those who didn’t (“Class A”).

Key Highlights

• PRISM withdraws Oyo’s complex bonus share plan after investor backlash
• New simplified proposal to include all shareholders equally
• Move aims to rebuild investor trust before Oyo’s upcoming IPO

The plan offered one CCPS for every 6,000 equity shares, with potential conversion ratios ranging from 1 to 1,109 equity shares — depending on whether Oyo appointed merchant bankers for its long-delayed IPO.

Investors and governance experts criticized the proposal as inequitable, saying it favored well-informed large shareholders and imposed unrealistic procedural burdens on smaller investors. Following weeks of backlash, PRISM extended deadlines and dropped document requirements but ultimately decided to scrap the plan entirely.

In a statement to Moneycontrol, PRISM confirmed it will introduce a new, simplified bonus structure that is automatic, inclusive, and fair, eliminating the opt-in process and covering both equity and preference shareholders. The company emphasized its focus on “governance-first growth” and shareholder fairness, seeking to rebuild investor trust ahead of Oyo’s much-anticipated IPO.

Also Read: OYO Taps Google Veo 3 for AI-Powered Global Ad Campaigns

The new plan will be tabled for shareholder approval soon, signaling a key course correction in Oyo’s corporate governance journey.