Initialize console will NOT recover SXOS. You'll have to have the license file that SXOS sent you when you purchased the license/modchip. I don't have a mod chip (don't have a Lite), but I had the SXOS pro + dongle for the original Switch, which required that license file. I assume the SXOS for modchip operates the same way. Problem is if you already lost that file, don't think there's anyway to recover because SXOS team already shutdown their operation - as far as I know; I have not checked in a long time.
If you still have that file, place it at the root of the SD, then inject their payload to see if you can get into SXOS.