NEW DELHI: Hospitality chain Oyo Hotels & Homes announced a commitment of Rs 1400 crore ($ 200 million) for the India & South Asia business on Tuesday. Oyo said the investment is directed at its efforts to further double down on its expansion plans, improve customer experience and ensure increase in asset owner success.
The company also announced the launch of its new brand Collection O to its existing portfolio and also introduced an in-app SOSbutton that activates on check-ins. Oyo said currently, over 93% of Oyo’s sales are from repeat or word-of-mouth customers.
Aditya Ghosh, CEO, India & South Asia said, “Key priorities as identified by the business for the year include delivering superior quality of product and service for every Oyo brand with a focus on safety and security, winning hearts and minds while expanding our presence deep and wide, a focused fast-paced growth while making partnering with Oyo the most attractive entrepreneurial opportunity for asset owners, a greater and deeper engagement among all Oyopreneurs and continuously evolve to become the most-loved hotel brand. Today, with the further investment of Rs 1,400 crore and the launch of mid-market brand Collection O hotels, I think we are all set to ensure our customers get the best experience and prices like always – but just a little better than yesterday. ”
Founder Ritesh Agarwal said losses as a percentage of realised value (Oyo Hotels’ sales run rate) are reducing year-on-year from 44.5% in financial year 2016-17 to 20.3% in financial year 2017-18. He said in financial year 2018-19, Oyo estimates further improvement in the economics of close to 50%, with losses going down to an estimated 10.4% in 2019. The company said globally it is now present in 10 countries,ll and over 500 cities including over 259 cities in India.
Agarwal, founder and group CEO, said: “With a strong balance sheet, today we can go to more places than ever, introduce new categories, invest in our assets, while maintaining our high-quality standards, without raising any further capital. Oyo was started with a simple mission of bringing beautiful living spaces for everyone. Today, as the world’s seventh-largest hotel chain, we are firmly moving towards our goal of bringing these great experiences at unbeatable prices to guests worldwide. We are committing over Rs 1,400 crore for technology investments, renovation, and managing investments for the calendar year, and will provide more, if needed, to help the team ensure continued economically efficient growth.”