NextFin News - OfBusiness is exploring a return to India’s IPO pipeline after deferring its earlier timetable, but the more important change is inside the business: the SoftBank-backed industrial commerce group is presenting a slower-revenue, higher-profit and more cash-generative profile that could be easier for public investors to underwrite. For the fiscal year ended March 31, 2026, consolidated revenue fell 7% to ₹20,645 crore, while profit after tax rose 21% to ₹724 crore and commerce free cash flow to the firm turned positive at ₹390 crore, according to company figures released in late July.
The IPO remains exploratory. No draft red herring prospectus or issue terms had been identified as of Aug. 5, 2026, and the reported plan does not establish an issue size, price range or listing date. The significance is therefore not that a transaction is imminent. It is that the company appears to be changing the equity story before returning to the market: less emphasis on topline expansion at any cost, more emphasis on margin, operating cash and the relationship between its commerce platform and lending arm Oxyzo.
That distinction matters because OfBusiness is not a conventional software company. It buys and sells industrial materials such as metals, chemicals, polymers and agricultural products, while using data from those transactions to offer working capital and other financial services to small and midsize businesses. Its reported revenue is large, but much of that revenue is tied to physical goods and therefore carries lower margins than a pure marketplace or software model. The public-market question is whether the combination of distribution, financing and cash generation deserves a growth valuation, a trading-company valuation, or something in between.
As of the data cutoff for this article, Aug. 5, 2026, the evidence points to a cyclical IPO revival built on a more structural operating change. Investor appetite can reopen and close with market conditions. A business that has converted scale into recurring cash generation is harder to reverse. OfBusiness will need to prove that the latter is real.
The IPO Has Returned as a Question, Not Yet as a Filing
The first question is what has actually changed since OfBusiness last set out its public-market timetable. In September 2024, Chief Financial Officer Bhavesh Keswani said the company was targeting an Indian offering of $750 million to $1 billion in the second half of 2025. About $200 million was expected to come from new shares, with existing investors selling the balance. Keswani said the proceeds would be used for debt repayment and expansion of the existing business.
That timetable passed without a public filing. Ofb Tech, the parent entity, took a preparatory corporate step by converting into a public company and adopting the name OFB Tech Ltd in January 2025. But a legal conversion is not an IPO. The company still has to make the business understandable in a prospectus, explain the treatment of its subsidiaries, set out related-party and lending exposures, and persuade investors that the proposed valuation can survive scrutiny of working capital and credit risk.
The latest report that OfBusiness is considering reviving the IPO therefore marks a change in intent rather than completion. It does not confirm that bankers have been appointed, that a valuation has been agreed, or that regulators have accepted draft documents. That restraint is important. The gap between a private-company plan and a listed security is where many high-growth stories encounter the costs of disclosure, governance and public price discovery.
Still, the operating data gives the revival a different foundation from the 2024 pitch. In FY24, OfBusiness reported operating revenue of ₹19,296.27 crore and consolidated profit after tax of ₹602.97 crore, up from ₹463.25 crore a year earlier. FY25 revenue rose to ₹22,241 crore while profit was ₹597 crore. In FY26, revenue declined to ₹20,645 crore, but profit increased to ₹724 crore. The resulting net-profit margin widened from 2.7% to 3.5%.
That is not the profile of a company maximizing volume. It is the profile of a company pruning or exiting lower-return activity while trying to retain earnings. OfBusiness said its commerce revenue was ₹19,174 crore in FY26 and that commerce EBITDA rose 34% to ₹769 crore from ₹575 crore, lifting the segment margin to 4% from 2.6%. The comparison is more informative than the headline revenue decline: the continuing commerce operation generated materially more operating profit from a broadly stable base after discontinued operations were adjusted.
The transaction, if revived, will be judged against that trade-off. A public investor may accept slower revenue growth if the company can show that each rupee of sales produces more cash and less balance-sheet strain. The burden is to establish that FY26 was a repeatable transition rather than a single-year benefit from mix, timing or discontinued businesses.
Cash Conversion Is the Transmission Mechanism
The central mechanism is not the IPO itself. It is cash conversion. OfBusiness can only support a public-market case if its commerce platform turns procurement scale into operating cash without requiring a proportionate increase in inventory, receivables or debt. The FY26 figures move in that direction: commerce operating cash flow rose to ₹1,302 crore from ₹715 crore, while free cash flow to the firm became positive at ₹390 crore for the first time.
That matters because a B2B materials platform is exposed to the accounting and financing demands of physical trade. Revenue can rise when commodity prices rise or when the company handles more volume, but working capital can absorb the economic benefit. Inventory must be financed, customers may take time to pay, and supplier terms can change. A company can therefore report rising sales and profit while generating weak cash. The opposite pattern in FY26 is more valuable: lower consolidated sales accompanied by stronger profit, operating cash and free cash flow.
At the first order, higher cash generation makes an IPO more credible. It reduces the need to sell a growth promise based on distant margins and gives investors a measurable link between earnings and capital formation. It also creates room to repay debt or fund expansion without relying entirely on fresh equity. That fits the earlier stated use of proceeds, which included debt repayment and growth.
The second-order effect runs through valuation. Better cash conversion can change the peer set investors use. A company valued only as a distributor is likely to face pressure from low margins, working-capital intensity and exposure to industrial cycles. A company that combines distribution with embedded credit and software-enabled procurement may command a higher multiple, but only if the financing income is durable and the credit losses remain controlled. The market will not award a platform premium simply because lending sits beside commerce on the organization chart.
Oxyzo is central to that test. The lending arm reported FY25 operating revenue of ₹1,207 crore, up from ₹903 crore, and net profit of ₹339.1 crore, compared with ₹290.5 crore a year earlier. Its total assets were reported at ₹9,236 crore. Those figures show that the group has built a meaningful financial-services operation, not just a checkout feature attached to an ecommerce site. They also increase the disclosure burden. Investors will need to understand funding sources, asset quality, concentration, capital adequacy, related-party exposure and the degree to which OfBusiness customers drive Oxyzo’s loan book.
The business model’s advantage is data. A customer that buys steel, chemicals or agricultural goods through OfBusiness leaves a transaction trail that can improve underwriting and create a financing opportunity. The risk is circularity. If credit helps a customer buy more through the platform, commerce growth and lending growth can reinforce each other until an industrial slowdown or customer default reveals that the apparent network effect was partly leverage.
“The focus remains on generating higher operating cash flows,” OfBusiness co-founder and Chief Executive Officer Asish Mohapatra said in the company’s FY26 statement.
That sentence is strategically revealing. It places cash ahead of the conventional startup metrics of gross merchandise volume, geographic expansion or customer acquisition. The statement is also a claim that can be tested. If cash generation remains positive through a weaker commodity or construction cycle, the shift is structural. If it reverses when inventory and receivables rise, the IPO story returns to cyclical scale.
Why the Timing Is Cyclical but the Repositioning May Be Structural
The revival of an IPO plan is cyclical. It depends on equity-market liquidity, investor appetite for Indian new issues and the willingness of private shareholders to accept public pricing. India’s FY25 mainboard IPO market raised about ₹1.63 trillion across 80 offerings, compared with ₹619 billion across 76 offerings in FY24, according to KPMG India. That backdrop gives a company like OfBusiness a broader exit window than it had during a weaker issuance period.
But a favorable issuance window does not explain the operating change. Three comparisons argue against treating FY26 simply as a market-timing story. First, FY24 revenue grew 25.7% to ₹19,296.27 crore while profit rose 30% to ₹602.97 crore. Second, FY25 revenue reached ₹22,241 crore but profit slipped slightly to ₹597 crore. Third, FY26 revenue fell to ₹20,645 crore while profit rose 21% to ₹724 crore. The sequence shows a business moving from scale-led growth toward mix and margin management across multiple reporting years.
The short-term driver is likely a combination of business exits, product mix and operating discipline. Those can mean-revert. Industrial demand, commodity prices and working-capital conditions will move with the economic cycle. A 4% commerce EBITDA margin is not a guarantee that margins will hold when steel prices fall, customers delay payment or competition forces the company to pass savings through to buyers.
The longer-term change is more durable if OfBusiness has permanently consolidated its operating structure and embedded financing into customer procurement. Its January 2025 conversion to a public company, earlier efforts to streamline subsidiaries and the decision to emphasize higher-margin commerce businesses all point to a regime change in how management wants the group measured. The shift is structural in strategy, not yet proven structural in returns.
That distinction is the second-order story. The obvious reading is that improving profit and cash flow make the IPO easier. The less obvious reading is that public investors will force a separation of the company’s engines. They may value the commerce business on margin and cash, Oxyzo on credit-adjusted returns, and any software or procurement tools on recurring revenue. The sum could be worth more than the private-company label, but it could also reveal that the parts have different risk profiles and deserve different discounts.
The group’s last known private financing provides a reference point but not a current valuation. OfBusiness raised $325 million from Alpha Wave Global, Tiger Global and SoftBank Vision Fund in December 2021 at a $5 billion valuation. That was a private-market mark from a different liquidity and interest-rate environment. Any new IPO valuation must be earned through current earnings, cash flow and governance rather than inherited from that round.
Investors will also examine whether the offering is primarily a capital raise or an exit. The earlier plan contemplated roughly $200 million of new shares and a larger secondary sale. A heavily secondary transaction can improve liquidity for early backers, but it gives public investors less evidence that their capital will fund growth. A larger primary component would strengthen the balance sheet, but it could also dilute existing shareholders and test the company’s claim that internal cash generation is improving.
The market window can reopen quickly. The operating model takes longer to prove.
The Strongest Counter-Thesis Is That This Is Still a Low-Margin Distributor
The strongest case against the IPO revival is not that OfBusiness lacks scale or profit. It is that the scale may be less valuable than the headline numbers suggest. A business that moves physical materials can generate very large revenue with thin margins, significant working-capital needs and earnings that vary with commodity prices. Even a 4% commerce EBITDA margin leaves limited room for freight inflation, credit losses, inventory mistakes or price competition.
That counter-thesis attacks the foundation of the platform narrative. If customers use OfBusiness primarily to obtain pricing, supply and short-duration credit, the switching costs may be lower than in software. Suppliers can sell through multiple channels. Buyers can shift volumes when spreads change. In a downturn, the financing function may become a source of losses at the same moment that commerce volumes weaken. A public valuation based on technology-enabled network effects would then overstate the durability of the economics.
The lending arm sharpens the concern. Oxyzo’s FY25 operating revenue of ₹1,207 crore and profit of ₹339.1 crore are substantial, but financial-company earnings must be judged after credit costs and against the capital required to produce them. A growing asset base is not automatically an asset to shareholders. The relevant questions are how much of the book is secured, how concentrated it is, how quickly delinquencies are recognized, and whether funding costs rise faster than loan yields.
OfBusiness has a credible answer if it can demonstrate that the platform creates better underwriting than an independent lender and that commerce margins improve as low-return lines leave the group. Its FY26 cash figures support that answer but do not finish it. The company must show that positive free cash flow was generated after maintenance investment and normal working-capital requirements, not merely after a temporary release of cash.
The specific falsifying signal for the structural-improvement thesis is a reversal in the next reported fiscal year: commerce EBITDA margin falling back below 2.6% while commerce operating cash flow drops below ₹715 crore, the FY25 levels, despite no comparable discontinuation of low-return businesses. That combination would suggest that FY26 reflected a favorable mix or working-capital episode rather than a durable change in economics. A separate warning would be a material deterioration in Oxyzo’s credit metrics alongside faster loan growth.
Management’s own forward language is measured. Mohapatra said, “FY27 will be a pivotal year for us as returns from prior investments play out.” The comment supports a business still in transition. It does not support a conclusion that the transition has already succeeded.
What the Revival Would Mean Across Time Horizons
In the short term, an IPO revival would primarily affect private-market liquidity and sentiment toward Indian business-to-business and fintech listings. The headline could improve exit prospects for SoftBank, Alpha Wave Global, Tiger Global, Z47 and other shareholders, while forcing potential investors to compare OfBusiness with other industrial-commerce platforms and profitable technology companies. The effect on valuation would depend less on the existence of a plan than on the filing details: primary versus secondary shares, leverage, governance, Oxyzo’s consolidation and the treatment of discontinued businesses.
In the medium term, public investors will focus on whether earnings quality catches up with earnings quantity. The base case is a filing that emphasizes FY26’s 21% profit growth, 3.5% net margin, ₹390 crore of commerce free cash flow and ₹1,302 crore of operating cash flow, while acknowledging that consolidated revenue fell 7%. In that case, the company could present itself as a disciplined industrial-finance platform rather than a volume-led marketplace. The trigger would be a draft prospectus showing stable or improving cash conversion and transparent credit disclosures.
The upside scenario requires more than a strong IPO book. It requires FY27 returns from earlier investments to lift revenue without giving back the FY26 margin gains, with commerce EBITDA staying at or above 4% and operating cash flow remaining above ₹1,302 crore. That would support the argument that the group can compound profit without rebuilding the low-return activities it exited.
The downside scenario is an IPO that arrives into a less receptive market or exposes weak cash quality. If revenue continues to contract, commerce margins fall below 2.6%, or Oxyzo’s asset quality deteriorates as lending expands, investors may apply a distributor discount to the commerce business and a credit-risk discount to the financial arm. A large offer-for-sale component would add pressure if existing holders appear more eager to monetize than the company is to fund expansion.
In the long term, the question is whether OfBusiness has created a new category or assembled several cyclical businesses under one ownership structure. The structural case rests on three durable features: transaction data that improves financing decisions, procurement density that improves sourcing economics, and a consolidated operating model that converts both into cash. The counter-case is that all three advantages weaken when industrial demand, commodity prices or credit availability turn.
The next objective evidence will be the filing itself, if it arrives, followed by FY27 revenue mix, commerce EBITDA, operating cash flow and Oxyzo’s credit performance. The single most important test is not the IPO’s offer size. It is whether cash generation survives growth.
OfBusiness is closer to a public-company story than it was in 2024, but it is not there yet. The IPO window is cyclical; the company’s attempt to make cash, not volume, the center of its case is the structural bet. If that bet holds through the next credit and industrial cycle, the delayed listing will look like preparation. If it fails, the delay will look like a warning.
OfBusiness is not reviving an old IPO story so much as testing whether disciplined cash generation can turn a thin-margin distributor into a durable public-market platform.
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