Looking East: Oyo Makes Headroom In China’s Hospitality Market With Launch In 26 Cities

OYO Hotels has finally announced its foray into the hospitality industry of China officially. Its current chain comprises of over 11,000 exclusive – franchised or manchised – rooms in 26 cities. The list includes Hangzhou, Xian, Nanjing, Guangzhou, Chengdu, Shenzhen, Xiamen and Kunming among others.

Earlier in May this year, reports surfaced about OYO’s expansion to China, operating in eight hotels with a total of 400 rooms.

With its foray into China, OYO is set to compete with well-established hospitality players in the country like GreenTree Inns, Motel 168, 7Days Inn, and Home Inns.

Commenting on the development, Ritesh Agarwal, Founder & CEO – OYO said, “China’s tourism industry is on the cusp of booming and flourishing wherein it enjoys a strong influx of both domestic and international tourists; also the market is as fragmented as the Indian hotel market.”

He further added that the expansion is in line with OYO Hotel’s mission of creating beautiful living spaces by empowering hotel owners to become better hospitality players while ensuring an end-to-end controlled experience for the guests.

China is officially the third overseas market for OYO. The company ventured into the international market in January 2016 with a foray into the Malaysian market. In May 2017, OYO ventured into Nepal as well.

As stated by OYO Hotels in a media statement, it will be working towards transforming the region’s hospitality industry by introducing its hotel brand and operating solutions.

“The aim is to ensure a seamless experience for both guests and asset partners while generating lucrative job opportunities for locals in smaller tier provinces,” added Ritesh Agarwal.

OYO claims to have transformed over 5,000 exclusive hotels in its chain through multiple formats including franchise, manchise and leased.  OYO works in close proximity with its asset partners while exercising full control over the hotels for ensuring a quality experience for travellers. Its network includes major metros, regional business hubs, top leisure destinations as well as pilgrimage towns.

Towards the end of 2017, in December, it shifted its business model from hotel aggregation to a franchise model. It now runs a pure-play franchise business, allowing hotel partners to run under the company’s brand.

The company is backed by leading investors, including the SoftBank Group, Greenoak Capital, Sequoia India, Lightspeed India, Hero Enterprise and China Lodging Group. With Series D funding of $250 Mn from SoftBank, OYO Hotels is fuelling its acquisition plans as well along with expansion. The company recently acquired Chennai-based service apartment operator Novascotia Boutique Homes.

An ET report earlier this year claimed that OYO has also forayed into Jakarta, Indonesia, with three hotels under its brand offering 130-plus rooms. It is also expected to begin its operations in Dubai soon. Further, OYO has been speculated to be exploring the US and UK markets as well.