Oyo, the budget hotel chain leader in the Indian market, has announced that it has secured Rs 64 crore ($10 million) in strategic funding from China Lodging Group.
Interestingly, this new funding round comes just a week after the company raised Rs 1,600 crore million funding from SoftBank Vision Fund and Hero Enterprise.
In a statement, the company said that OYO will combine its technology strengths and operational expertise with China Lodging Group’s extensive coverage and strong development capability in China.
Ritesh Agarwal, founder and CEO, Oyo, said,
China Lodging Group has an experienced leadership team and hotel operations expertise especially in managing large properties. Oyo is a new-age technology company disrupting the hospitality industry with category-leading capabilities of using technology to onboard and transforms existing supply, standardize operations and distribute these through online and offline channels.
The startup has recently shifted its focus towards Townhouse, which targets the mid-premium segment as compared to budget consumers. The hotel aggregator is planning to introduce 200-250 Townhouse properties across the country by the end of this year.
OYO was founded in 2014 by Ritesh Agarwal with a vision to standardize and build efficiency into all forms of real estate such as budget hotels, apartments, guest houses and resorts.
Currently, Oyo operates around 8,500 hotels and 70,000 rooms in more than 230 cities. On the other hand, China Lodging operates over 3,500 hotels across some 369 cities in China. Around one-quarter of its hotels are operated via a lease and ownership model with the rest franchised or managed franchises.
According to Deutsche Bank, nearly two-thirds of India’s rooms supply in 2020-21 will comprise of budget hotels. Criteo is expecting the online travel market in Asia Pacific to be worth $446 billion in value by 2020.