In order to better represent its enlarged worldwide portfolio and long-term vision, Oravel Stays Ltd., the parent company of the lodging chain OYO, relaunched itself as PRISM.
On September 7, the firm declared that the OYO brand would remain its primary consumer-facing identity in the low-cost hospitality sector. OYO was founded in 2012 by Ritesh Agarwal and began as an Indian low-cost hotel aggregator before growing into a multinational travel technology and hospitality conglomerate.
With services including hotels, holiday rentals, long-term stays, co-working spaces, and event spaces, the company now serves over 100 million clients in 35+ countries.
OYO Adopting New Business Strategies
With names including Sunday, Palette, and Townhouse in premium hospitality; Belvilla and DanCenter in vacation homes; Studio 6 in extended stays; and Innov8 and Weddingz.in in workplaces and celebration venues, OYO is rebranding as it seeks to position itself beyond low-cost lodging. In 2023, OYO expanded its presence in North America by acquiring G6 Hospitality, a US-based company that operates Motel 6 and Studio 6.
The move to PRISM, according to Founder and Group CEO Ritesh Agarwal, signifies the creation of a corporate architecture that is fit for the future and will help us match our growing portfolio with our long-term goals. PRISM is driven by a robust technological engine, increased investments in AI and data science, and a dedication to assisting company’s partners in making a profit while satisfying customers throughout the globe.
According to the company, the new identity aims to highlight its technological foundation while bringing its many offers together.
Why OYO is Rebranding to PRISM?
According to the firm, a global naming competition with over 6,000 proposals led to the selection of the name PRISM. The makeover is the first significant change to OYO’s corporate identity since its inception, highlighting the company’s intention to move away from its reputation as a pure-play low-cost hotel aggregator and towards becoming a more comprehensive worldwide hospitality and travel technology platform.
OYO’s IPO Plans and Financial Goals
This occurs as the business, valued at $7-8 billion, prepares to submit its Draft Red Herring Prospectus (DRHP) in November. OYO submitted and refiled its draft papers with the Securities and Exchange Board of India (SEBI) in 2021 in an attempt to collect INR 8,430 crore through an IPO.
As the firm prepares for a renewed initial public offering (IPO) later this year, the corporate rebranding comes at a critical juncture to emphasise its transformation from a low-cost hotel aggregator into a diverse global hospitality and travel-tech platform.
Quick Shots
•OYO brand to remain consumer-facing identity in
budget hospitality segment.
•Company now serves 100M+ customers across 35+ countries
with hotels, holiday rentals, co-working, and event spaces.
•PRISM name chosen from 6,000+ entries in a global
competition.
•IPO plans in November 2025, with DRHP filing for
INR 8,430 crore fundraising.
The hospitality giant OYO has apparently resumed talks for its public offering amidst the persistent rumours surrounding its IPO. The company plans to submit its draft red herring prospectus (DRHP) to SEBI between August and September of this year.
According to a news agency citing sources, the firm has had preliminary talks with several investment banks, who have stated that OYO may fetch between $6 billion and $7 billion when it goes public.
The firm plans to make its market debut by the March quarter (Q4) of fiscal year 2025–2026 (FY26). Notably, after abandoning plans to go public in 2022 and 2024, this would be OYO’s third try.
A key meeting between OYO’s board and officials of SoftBank, which owns more than 30% of the business, is planned for London next month.
SoftBank Pushing OYO’s IPO Plans
SoftBank reportedly suggested that OYO postpone its IPO aspirations for several months, according to reports that surfaced weeks ago.
According to another media outlet, OYO had previously stated that it aimed to list by October of this year, but after SoftBank’s intervention, the business moved the deadline to March 2026.
As per earlier reports, CEO Ritesh Agarwal was under pressure from creditors to speed up the IPO process.
To put things in perspective, Agarwal increased his ownership of OYO in 2019 by taking out a $2.2 billion loan that was personally guaranteed by Masayoshi Son of SoftBank. One instalment of $383 million was due in December 2025 as part of the restructured debt.
OYO Ringing the Profit Bells
In FY25, OYO declared a profit of INR 623 crore. Strong growth in its portfolio of premium hotels and international development drove a 172% increase in profit after tax and a 20% increase in revenue to INR 6,463 crore compared to the previous year.
Additionally, OYO recently settled a significant legal challenge, coinciding with the relaunched IPO attempt. The Delhi High Court decided in favour of OYO in its protracted dispute with ZO Rooms’ parent business, Zostel Hospitality, in May 2025.
Because there was no legally binding acquisition agreement between the two corporations, the court overturned an earlier arbitral ruling.
It came to the conclusion that during the unsuccessful deal negotiations that began in 2015, OYO had not violated any contractual duties.
OYO’s Previous IPO Attempt
Oyo filed and refiled its draft papers with the Securities and Exchange Board of India (SEBI) in 2021 in an attempt to collect INR 8,430 crore through an IPO.
This is the reason for the ongoing effort for an IPO. In May 2024, the business eventually retracted such documents.
Oyo has recently strengthened its position in important markets like India, the US, Europe, and Southeast Asia while streamlining its international operations.
According to sources, the company’s enhanced operational effectiveness and financial indicators have boosted investor confidence, which is why it is making a second bid to go public.
With an emphasis on Townhouse by OYO-branded hotels, Oyo has declared its intention to enter the food and beverage industry. It plans achieve this goal by establishing in-house kitchens and Quick Service Restaurant (QSR) carts/lobby stores at its company-serviced hotels, the firm said on May 1.
According to Oyo, this programme will provide in-house cooking services to guests at 1500 of its company-serviced hotels in FY26. By choosing the “Kitchen Services” option, visitors will be able to place meal orders through internet channels such as OTAs and the Oyo app.
Depending on the specific hotel profile and backend infrastructure, the kitchen configuration could range from a full-fledged commercial kitchen for a large menu to a pantry setup for basic food items, according to Oyo.
Introducing QSR Carts and Lobby Stores
Oyo is launching QSR carts and lobby stores under the “Townhouse Cafe” brand in addition to in-house kitchens. According to the firm, the menu will emphasise reasonably priced meals that include both continental and regional cuisine.
According to Oyo, on a steady-state basis, it anticipates that F&B will add 5%–10% to hotel revenue. Since January of this year, Oyo has started a pilot program at 100 company-serviced hotels in a few cities, including Delhi, Gurgaon, Hyderabad, and Bangalore, to test the idea.
According to the firm, this has cleared the path for the nationwide launch in the next fiscal year. Chief Operating Officer Varun Jain, Providing ‘fresh’, ‘convenient’, and ‘quality’ meal options throughout its network, Oyo stated, the project seeks to improve the in-hotel eating experience for travellers.
A network of “trusted F&B experts” is being established in major cities including Delhi, Mumbai, Bangalore, Hyderabad, Pune, Indore, Kolkata, Jaipur, and Lucknow, according to Oyo, to assist this.
Broader Push to Increase Revenue Streams
The QSR initiative appears to be a component of Oyo’s larger effort to increase income by offering related services. The company has previously ventured into the food industry; in 2019, it started a cloud kitchen business but shut it down during the pandemic.
Despite being a logical progression of the hotel industry, food operations demand specialised knowledge and committed staff. Oyo probably learnt a lot from its first try and now seems more equipped to grow its food company in a more strategic and sustainable way.
Oyo Hotels and Homes Pvt. Ltd. reported a 15% drop in revenue from INR 1,312 crore to INR 1,113 crore for FY24, a significant drop.
The company declared a profit of INR 11.5 crore over a loss of INR 27 crore in FY23, according to documents filed in January with the Registrar of Companies.
This was mainly due to a reduction of INR 6 crore in overall expenses and a positive growth in extraordinary items from a loss the previous year.
After getting GST show cause notifications totalling INR 2.66 Cr, a resort in Jaipur is said to have filed a formal complaint against OYO and its co-founder, Ritesh Agarwal. According to a media report, Madan Jain, who works for Samskara Resorts, filed a formal FIR at the Ashok Nagar police station in Jaipur last week. The complainant claims that OYO gave “inaccurate information” that led to the notices. The FIR cites a number of people in addition to OYO and Agarwal for criminal conspiracy, forgery, cheating, and criminal breach of trust under the Bharatiya Nyaya Sanhita (BNS). According to the FIR, on April 18, 2019, Samskara Resorts in Jaipur and OYO inked a 12-month contract. The resort says it paid the GST owed because it saw commercial transactions worth INR 10.95 lakh during that time. In addition to the penalty, the FIR alleges that OYO made reservations with Samskara for INR 22.22 Cr during the fiscal years 2018–19, 2019–20, and 2020–21, for which the GST bill of INR 2.66 Cr is still outstanding.
20 Hotels Received Inflated Bills
Husain Khan, head of the Hotel Federation of Rajasthan, told a media outlet that up to 20 hotels had got GST notices based on “inflated bills” that OYO allegedly provided. The Federation launched a campaign against OYO four years ago, Khan claimed, citing the company’s “poor record” with hotels. OYO, which Agarwal founded in 2012, provides corporate stays, affordable hotels, coworking spaces, vacation rentals, and casino hotels, among other things. To date, the business has collected around $4.5 billion in capital, with companies like Microsoft and SoftBank Group among its investors.
Financial Outlook of OYO
Agarwal informed staff via email a few weeks before the FIR that the startup was on course to record a 60% year-over-year (YoY) revenue growth in the fourth quarter (Q4) of the fiscal year 2024-25 (FY25) to INR 2,100 Cr. In the email, Agarwal stated that the effective merger of G6 Hospitality, which increased the company’s revenue by INR 275 Cr, was a major factor in this performance. After a net loss of INR 1,286.5 Cr in the previous fiscal year, OYO recorded its first profitable year in FY24 with a net profit of INR 229 Cr. Revenue, however, decreased 1.3% from INR 5,463.9 Cr in FY23 to INR 5,388.78 Cr in the reviewed year.
In the earlier days, the hospitality industry operated on a localized scale, limiting itself to specific areas. People often discovered accommodations only upon reaching their destination or relied on agents for lodging during travel. The unbranded nature of this industry introduced uncertainties, which were subsequently addressed and reshaped during the internet and technological boom.
This transformative period saw the emergence of various players, such as Airbnb and FabHotels, with OYO standing out among them. OYO’s rapid success and widespread popularity played a pivotal role in branding and restructuring the entire industry in our country. Notably, OYO has evolved to become the third-largest hotel chain globally (as of June 2019).
In this article, we will delve into OYO success story, startup story, its history, its founder, business model, funding, competitors, and more.
OYO, also referred to as OYO Hotels or OYO Rooms, is an international hospitality platform that offers reasonably priced lodging options all over the world. The business offers consumers the option to choose rooms and living areas that best fit their needs at an affordable price by listing both franchised and leased hotels on its marketplace.
OYO’s successful marketing tactics and flexible expansion plans are responsible for its noteworthy growth. Founded in 2012, OYO, with its headquarters in Gurgaon, Haryana, was established by Ritesh Agarwal when he was just 19 years old. The business has considerably grown since its founding, operating in several cities across several nations.
Apart from standard hotel accommodations, OYO provides an extensive array of services, assisting users in locating residences, holidays, long-term and short-term rentals, and meeting different business or corporate travel requirements. OYO is positioned as a flexible participant in the international hospitality market.
OYO – Industry
As to a report analysis by Statista, the hotel industry is anticipated to witness significant expansion, with a revenue of US $9.13 billion by 2024. The results point to a strong expansion trajectory and a predicted annual growth rate (CAGR 2024–2028) of 5.41%.
The market volume is predicted to rise further if current trends continue, with an anticipated value of US $11.27 billion by 2028. Based on thorough research carried out by Statista, these estimates highlight a good picture for the hotel business, demonstrating ongoing expansion and changing consumer patterns.
OYO – Founders and Team
Ritesh Agarwal is the co-founder and Group CEO of OYO.
Ritesh Agarwal
Ritesh Agarwal, Co-Founder and Group CEO of OYO
Ritesh Agarwal is the co-founder and Group CEO of the online hospitality chain OYO. He was born in Odisha. His interest in business started early in his teens. Ritesh dropped out of college and was accepted into the Thiel Fellowship program in 2013. His time at Thiel Fellowship and the year before laid the foundation for OYO. He has joined the Shark Tank India Season 3 panel as the youngest shark.
OYO – Startup Story
OYO Rooms story began with Ritesh Agarwal’s vision to provide affordable and standardized hotel rooms for budget travelers, which quickly expanded into a global hospitality brand, now operating in over 80 countries. While residing in California in 2013, Ritesh Agarwal started OYO with the original goal of running an Indian hotel through Oravel Stays. Targeting low-cost tourists online, the hotel in Gurgaon later rebranded as OYO saw a sharp increase in occupancy rates in just its first month, going from 19% to 90%. After coming back to India, Agarwal saw the opportunity to elevate budget accommodations throughout the world.
OYO’s concept arose from Agarwal’s desire to please both owners and guests. It is focused on smart updates, optimized services, and dynamic pricing. OYO’s strategy, which was centered on the preferences of its guests and little elements like soft white light, enhanced reviews, and guaranteed profitability, signifying its transformation from a single property to a worldwide hospitality network.
OYO – Mission and Vision
Mission: The OYO mission on the company website is mentioned as “OYO is a global platform that empowers entrepreneurs and small businesses with hotels and homes by providing full-stack technology that increases earnings and eases operations. Bringing affordable and trusted accommodation that guests can book instantly.”
Vision: OYO vision is to empower entrepreneurs and small businesses with homes and hotels to increase earnings and simplify their operations.
OYO – Name and Logo
OYO Logo
The name OYO stands for ‘On Your Own’ rooms. Earlier, the company was named ‘Oravel’ but later changed to OYO.
OYO – Business Model
OYO’s unique business model represents the first hotel chain to be integrated with OTA-like distribution capabilities. In contrast to conventional approaches, OYO tackles practical issues in the actual world, with brand development coming naturally rather than as the main goal.
It functions as a redesigned hybrid, skillfully fusing technology and hospitality to maximize client satisfaction, efficient use of available space, and general corporate success.
The dedication to customer pleasure that is at the heart of OYO’s ideals is demonstrated by the company’s initial acceptance requirements and its upfront investment in modernizing each hotel before it joins the OYO network.
OYO’s core advantage is its ability to consistently prioritize the needs of its customers. The company has shaped its business model to optimize the customer experience, effectively utilizing technology and hospitality to improve space utilization and overall business performance.
OYO – Revenue Model
OYO employs a diverse revenue model to sustain its business, featuring several key streams:
Commissions:
OYO has a commission-based business model, taking a cut of about 22% from its hotel partners for each reservation made via its website. Depending on variables like property kind, location, and other considerations, the proportion might change.
Franchise Charge:
OYO has a franchise model whereby it charges its partners fees for the use of its technology, brand, and operational assistance. One-time or ongoing payments are included in this income stream, which makes up a sizable portion of OYO’s earnings.
Room rate margins:
By selling rooms to visitors at a higher price than it originally negotiated with partner properties, OYO makes money by keeping the difference between the selling and reduced rates.
Membership in OYO Wizard:
Wizard Blue, Wizard Silver, and Wizard Gold, OYO’s premium memberships, are a profitable revenue stream.
Promotions, Collaborations, and Sponsorships:
Through sponsorships, brand promotions, and advertisements on its website and app, OYO makes money off of its platform. To increase overall revenue, businesses pay OYO fees for the display of their advertisements.
Income from Supplementary Services:
By charging more for upscale offline services and facilities, OYO diversifies its revenue sources. Breakfast, transportation, laundry, and other extras bring in money and give consumers something extra, all while strengthening OYO’s bottom line.
OYO – Challenges Faced
OYO faced various difficulties in the past that are typical of many startups. The business struggled with massive layoffs, conflict with hotel partners, and lawsuits related to disagreements in contracts. Although the aggressive pricing strategy was successful in drawing in customers, it also caused worries about profitability and sparked legal attention, especially because of claims of predatory pricing.
Due to complaints of dormant or nonexistent listings, the legitimacy of OYO’s platform was also called into question. The COVID-19 pandemic dealt a further blow to these difficulties, forcing OYO to traverse a challenging environment and deal with governance concerns to ensure a stable future. These obstacles are similar to those that startups in the cutthroat hotel sector frequently encounter.
OYO went through 21 funding rounds as of 2024 out of which it has raised $3.5 billion. Their latest funding was raised on Aug 11, 2024, from a Series G round of $175 million by Incred Wealth.
Below are some of the recent funding rounds of OYO:
OYO’s shareholding pattern as of January 2025, sourced from Tracxn:
OYO Shareholders
Percentage
Ritesh Agarwal
6.2%
Red Spring Innovation Partner
1.4%
SoftBank
40.5%
Patience Capital Group
3.4%
Sequoia Capital
2.8%
Lightspeed Venture Partners
2.9%
Grab
1.6%
Didi
1.6%
Greenoaks
0.6%
DIG Investment
0.2%
Hindustan Media Ventures
< 0.1%
ASK Group
< 0.1%
InCred Capital
< 0.1%
Analah Ventures
< 0.1%
Arthya
< 0.1%
Ra Hospitality
19.4%
Airbnb
1.2%
Five Stars Capital
0.9%
Global Ivy Ventures
0.8%
China Lodging Holding
0.7%
J&A Capital Partners
0.5%
Stability Investment
< 0.1%
Microsoft
< 0.1%
Group SNS
< 0.1%
Do Moonstone Advisors
< 0.1%
Angel
< 0.1%
Other People
< 0.1%
ESOP Pool
11.5%
Other Investors
1.4%
Total
98.0%
OYO Shareholding
OYO – Investments
OYO has invested in OYO LIFE, signaling a strategic move to diversify its portfolio beyond conventional hospitality services as of October 30, 2018.
OYO – Acquisitions
OYO has acquired 10 companies around the world so far. The latest acquisition was announced on September 20, 2024, that Oravel Stays Ltd, the parent company of OYO, had acquired G6 Hospitality LLC, the parent company of the Motel 6 and Studio 6 brands for $525 million.
The following are the 10 companies that have been brought under the management of OYO:
Date
Company
Amount
September 20, 2024
G6 Hospitality
$525 million
August 10, 2022
Bornholmske Feriehuse
–
May 9, 2022
Direct Booker
–
September 2, 2019
Danamica
$10 million
May 1, 2019
Leisure Group
$415 million
March 26, 2019
Qianyu Islands
–
March 15, 2019
Innov8 Coworking
$30 million
August 13, 2018
Weddingz
–
July 10, 2018
AblePlus Solutions Pvt Ltd.
–
March 18, 2018
Novascotia Boutique Homes
–
OYO – Growth
OYO’s journey began modestly, evolving from a small platform supporting local customers and businesses into the world’s third-largest multinational hotel chain as of June 2019. Starting in 2012, OYO debuted with sponsorship support and unveiled its website in its first year of operation. The firm reached 100 cities with 10,000 rooms by 2015, and in 2016, it went outside of India and then later went on to expand into the UK, China, the US, Indonesia, Europe, and other regions
OYO launched several services throughout its expansion phase, including OYO Townhouse, OYO Workspaces, OYO Wizard, and OYO Life. Even with sporadic controversies like the one with the relationship mode’ feature the business became well-known. OYO’s strategic expansion and ongoing introduction of new features helped to cement the company’s reputation throughout the world.
Some of the growth highlights of OYO are:
OYO Corporate Business Solution has 4,000+ exclusive hotels, as mentioned on their website as of January 2024.
OYO Corporate Business Solution has a presence in 230+ cities and towns as of January 2024, spanning across 4 countries.
OYO has over 174,000 hotels and homes around the nation as of January 2024.
It is present in over 35 countries as of January 2024.
OYO reached the milestone of 100 million downloads in 2021.
The estimated company valuation is $2.7 billion as of August 2024.
OYO – Financials
OYO’s financial performance over the last few years shows a steady increase in revenue, despite fluctuations in its profits and expenses. The company has been making strides in improving its operational efficiency, but still faces significant challenges, with losses in some years.
Particulars
FY24
FY23
FY22
FY21
FY20
Revenue
INR 5,541.6 Crore
INR 5,601.7 Crore
INR 4,905.2 Crore
INR 4,157.4 Crore
INR 14,113.2 Crore
Expenses
INR 5,725.8 Crore
INR 6,799.7 Crore
INR 6,985.3 Crore
INR 6,936.1 Crore
INR 25,375.1 Crore
Profit/Loss
INR 229.6 Crore
INR -1,303.6 Crore
INR -2,130.9 Crore
INR -3,823.5 Crore
INR -13,038.7 Crore
OYO Financials
OYO Revenue:
Particulars
FY24
FY23
Revenue from Operations
INR 5,388.8 crore
INR 5,463.9 crore
Other Income
INR 152.8 crore
INR 137.8 crore
Total Revenue
INR 5,541.6 crore
INR 5,601.7 crore
Revenue from Operations decreased slightly from INR 5,463.9 crore in FY23 to INR 5,388.8 crore in FY24.
Other Income also decreased from INR 137.8 crore in FY23 to INR 152.8 crore in FY24, but the overall revenue remained relatively stable.
OYO Expenses:
Particulars
FY24
FY23
Operating Expenses
INR 2,885.4 crore
–
Employee Benefit Expense
INR 744.4 crore
INR 1,548.8 crore
Finance Costs
INR 843.8 crore
INR 681.6 crore
Amortization & Depreciation
INR 200.3 crore
INR 280.3 crore
Other Expenses
INR 1,051.8 crore
INR 4,289 crore
Employee Benefit Expenses decreased significantly from INR 1,548.8 crore in FY23 to INR 744.4 crore in FY24, showing a major reduction in employee-related costs.
Other Expenses also decreased from INR 4,289 crore in FY23 to INR 1,051.8 crore in FY24, reflecting better control over non-operational costs.
OYO Profit/Loss:
Particulars
FY24
FY23
Gross Profit
INR 235.8 crore
INR -1,303.4 crore
Operating Profit
INR -174.1 crore
INR -1,198 crore
Net Profit/Loss
INR 229.6 crore
INR -1,303.6 crore
Gross Profit shifted from a loss of INR 1,303.4 crore in FY23 to a profit of INR 235.8 crore in FY24.
Operating Profit also showed improvement, with a loss of INR 1,198 crore in FY23 reducing to a smaller loss of INR 174.1 crore in FY24.
Net Profit/Loss improved significantly, moving from a loss of INR 1,303.6 crore in FY23 to a profit of INR 229.6 crore in FY24.
OYO made a profit of INR 158 crore in the second quarter of FY25, ending in September, as shared by the founder Ritesh Agarwal in a town hall meeting, according to sources. OYO’s parent company, Oravel Stays Ltd, had a loss of INR 50 crore during the same period last year in FY24. In the first quarter of FY25, OYO’s profit after tax was INR 132 crore, bringing its total profit for the first half of FY25 to INR 290 crore ($35 million). This is a big turnaround from the INR 91 crore net loss in the same period last year. OYO’s revenue in Q2 FY25 also grew to INR 1,578 crore, up from INR 1,413 crore in Q1.
EBITDA
OYO FY23-FY24
FY23
FY24
EBITDA Margin
-4.23%
15.52%
Expense/₹ of Op Revenue
₹1.24
₹1.06
ROCE
-8.60%
13.40%
OYO – Programs and Feature launch
Super OYO program
The Super OYO program was introduced by OYO in December 2022. Through this initiative, customers were able to identify hotels that provided the most reliable and superior customer service.
OYO Accelerator Program
In March 2023, OYO announced the launch of the Accelerator Program, with plans to add more than 200 properties in key Indian cities to its portfolio as part of the accelerator project.
OYO Spotless Stay Program
In July 2023, OYO introduced the Spotless Stay Program, as part of their planned initiatives. The program was designed to implement new cleaning and hygiene requirements, simultaneously enhancing hotel and room decor.
Stay Now, Pay Later Feature
OYO has introduced the Stay Now, Pay Later Feature in June 2023. This feature follows the rise in popularity of buy now, pay later (BNPL) plans for buying consumer electronics from retail stores and e-commerce websites.
OYO New Brand Palette
In cities including Jaipur, Hyderabad, Digha, Mumbai, Chennai, Manesar, and Bengaluru, OYO said it has opened 10 Palette resorts as a pilot program. By Q2 FY24, it plans to increase that number to 40 as per various news reports said in July 2023.
OYO – Partnerships
Some of the prominent partnerships of OYO are:
Lemon Tree
In March 2023, OYO had established a partnership with Lemon Tree. The collaboration aimed to enhance the occupancy of Lemon Tree Hotels’ banquets and event spaces in over 40 locations nationwide, including Delhi NCR, Jaipur, Kolkata, Lucknow, Bhubaneswar, Mumbai, and Pune, among others.
SoftBank
In September 2023, the parent company of OYO, Oravel, formed a partnership with SoftBank. Through this collaboration, they introduced the premium hotel chain Sunday in India, establishing a relationship with SoftBank Japan.
OYO – Layoff
In December 2022, OYO made 600 layoffs as part of a significant reorganization, which had an impact on the corporate and technology divisions.
OYO – Advertisements and Social Media Campaigns
OYO Campaign
OYO launched a multi-film brand campaign that featured renowned actors such as Gul Panag, Kalki Koechlin, Chitrangada Singh, and Kunal Kapoor. The campaign aimed to highlight the everyday experiences of tourists by utilizing television, social media, and over-the-top platforms.
In response to the changing tastes of travelers during the pandemic, OYO placed a strong emphasis on customization and flexibility in its brand campaign. The first movie emphasized the advantages of OYO’s “Nearby” feature, which allows customers to easily book lodging with a tap on the smartphone and takes advantage of OYO’s widespread presence in over 35 countries globally.
OYO – Awards
OYO has won various awards. Some of the prominent ones are:
In the hospitality sector, the Ministry of Skill Development and Entrepreneurship presented the 2017 National Entrepreneurship Award to OYO.
OYO won the 2019 ASEAN-India Excellence & Achievement Award.
OYO won the 2018 ET Startup Awards, the biggest startup competition in India.
OYO – Competitors
The following are some of the top competitors of OYO:
Airbnb
Airbnb is one of the popular and well-known competitors of the company. It was established in 2007 and is considered to be a predecessor and a luminary for OYO. Airbnb serves to be a trusted brand globally due to its affordable prices and availability of excellent accommodations.
Treebo Hotels
Treebo is a growing hotel chain in India that has established its operation in over 113 cities in the country. This company operates in the category of the premium budget segment. Treebo Hotels is based in Bangalore, Karnataka, India.
FabHotels
FabHotels was founded in 2014 by two alumni of “The Wharton School of the University of Pennsylvania.” It rents out 3-star rated hotels at a budgeted price under its brand. FabHotels operates in more than 66 cities, with over 900 hotels in India as of November 2022.
SUNDAY Hotels, a premium brand of OYO, aims to launch 25 new hotels in key travel destinations across India by March 2025. The expansion will include immediate openings in Gurgaon, Manesar, and Corbett, following recent launches in Jaipur, Vadodara, and Chandigarh. Launched in May 2023, SUNDAY Hotels is a joint venture between SoftBank Group and Oravel Stays.
OYO had originally planned to go public in 2022, but due to worries about the worldwide market slump and how it may affect the firm’s valuation, the company decided to strategically delay its IPO to an unspecified future date. This delay was caused by the worry of a reduced worth.
According to a news report from January 2024, the Indian hotel booking company, supported by SoftBank Group Corp., is allegedly in talks with Khazanah to lead a $400 million fundraising to pursue expansion and debt reduction. It’s crucial to remember that this information has not yet been verified.
Furthermore, according to a different news report from January 16, 2024, OYO intends to expand its portfolio by 400 new hotels with an emphasis on religious tourism.
FAQs
What is OYO?
OYO, also referred to as OYO Hotels or OYO Rooms, is an international hospitality platform that offers reasonably priced lodging options all over the world. The business offers consumers the option to choose rooms and living areas that best fit their needs at an affordable price by listing both franchised and leased hotels on its marketplace.
Oyo started in which year?
OYO was established in 2012.
Who is the founder of OYO?
Ritesh Agarwal is the founder of OYO.
What is the valuation of OYO?
The valuation of OYO is $2.7 billion as of August 2024.
What is OYO famous for?
OYO is famous for budgeted hotel bookings and affordable stays.
Who are the top competitors of OYO?
Some of the top competitors of OYO are:
Airbnb
Treebo Hotels
FabHotels
How did OYO start?
Ritesh Agarwal launched Oravel Stays in 2012 as a website for listing and booking budget accommodations. The company was later rebranded as OYO in 2013.
What is the success story of OYO startup?
OYO’s success story is a tale of rapid growth in the hospitality industry. Founded by Ritesh Agarwal in 2013, it started as a budget hotel chain and quickly scaled up by offering standardized, affordable rooms across India. OYO’s innovative business model, focusing on technology, has allowed it to expand internationally. Despite facing losses in early years, the company has secured major investments and is now one of the largest hotel chains globally, known for its widespread presence and a large number of partner hotels.
OYO, a travel tech platform, is speeding up its plans for an IPO as it approaches a significant deadline for year-end debt payments. A media agency reported that if the business doesn’t go public by October, creditors, notably Mizuho Financial Group Inc., are putting pressure on founder Ritesh Agarwal to pay back a $383 million loan that was a part of a bigger financing package. According to the story, which cited sources, lenders want to know more about Agarwal’s financial situation and might postpone the payback deadline until 2027—but only if OYO goes forward with listing this year. With a guarantee from SoftBank CEO Masayoshi Son, the OYO founder borrowed $2.2 billion in 2019 to expand his ownership of the company and fortify his strategic control over the business. According to the article, Agarwal has not yet paid back the first tranche of the loan, which was restructured in 2022.
The Much Awaited IPO
Although OYO had long contemplated an IPO, their intentions were thwarted by the COVID-19 pandemic. According to the sources, the business has now started talking to bankers about a possible listing and is looking for a valuation of up to $5 billion. With a holding of more than 40%, SoftBank continues to be OYO’s largest stakeholder, while Agarwal, whose prior IPO attempts failed, owns more than 30%. When OYO’s IPO preparations are finalised, they will consider the company’s “strong net profits” for the fiscal year ending March 2024 and an “expected strong year” through March 2025, according to a statement from Agarwal’s family office. The family office refuted claims about reorganisation and funding arrangements as “completely incorrect” and called them rumours or speculation. Additionally, it denied the rumoured valuation, claiming that it is lower than recent secondary trades that they are aware of and does not reflect reality.
What Lead to the Financial Crunch?
Founded in 2013, the travel tech business with its headquarters in Gurugram gained the support of SoftBank, who promoted aggressive expansion into areas such as the US and Japan, which ultimately resulted in significant failures. Due to its dependence on low-cost hotels for budget-conscious clients, OYO was especially susceptible to the COVID-19 outbreak, which had a negative effect on its operations. The company’s difficulties, which range from legal challenges to losses brought on by overly ambitious overseas development, are indicative of India’s startup boom, which was fuelled by venture financing but stalled as investors turned their attention to profitability.
The Recovery Mode
OYO has steadily recovered after the pandemic, and as sales increased, it reported a slight profit for the fiscal year that ended in March 2024. Through his Singapore-based investment company, Patient Capital, Agarwal contributed over $95 million to the business at the end of 2023. In the second quarter of FY25, OYO declared a net profit of INR 158 crore. For the next two quarters of FY25, the business was able to report profits. OYO reported revenue of Rs 5,541.6 crore and a net profit of INR 229.6 crore for FY24, according to research platform Tracxn.
Recent strategic initiatives of the company include the premiumization of its portfolio in India, the acquisition of Checkmyguest, a rental home company located in Paris, and G6 Hospitality, a significant hotel chain based in the United States. Moody’s, a global rating agency, kept its outlook unchanged and raised OYO’s rating from B3 to B2. In FY25–26, OYO’s first full year of profits consolidation with its recently acquired businesses, it projects that its EBITDA will reach $200 million.
OYO Rooms, also known as OYO Hotels & Homes is the third-largest hospitality chain by room count providing a comfortable room stay and ensuring the acceptability of the services by the OYO’s customers in more than 80 nations. Incorporated in 2013 by Ritesh Agarwal (one of the youngest Indian entrepreneurs, the founder and CEO of OYO Rooms) it has established itself as the fastest-growing network of hotels offline and online.
Headquartered in Gurgaon, it has expanded its reach worldwide within the span of 10 years and has employed over 17,000 employees globally. However, this is not the only reason why OYO has recorded such a huge success. Its excellent marketing strategy shows that it continues to be a leading hotel chain.
Ritesh Agarwal started his journey at the age of 17 and is considered to be one of the youngest CEOs in India. In 2011, Ritesh moved to Delhi with the intention of starting his own business. Soon, he started traveling extensively across India and stayed in PGs or budget hotels. These unpleasant traveling and stay experiences led him to launch Oravel Stays in 2012.
Ritesh has been one of the judges in Shark Tank India since Season 3.
Ritesh Agarwal – Founder & CEO, OYO Rooms
Oravel to OYO Rooms
Oravel Stays Pvt.Ltd was Ritesh’s first startup. Oravel was designed to enable the listing and booking of budget and premium accommodations.
It was meant to be a destination for short and midterm rentals for bed and breakfast joints, private rooms, and serviced apartments.
Oravel was then transformed into OYO Rooms in 2013 when Agrawal realized that a combination of bed and dinner was not sufficient. He proposed to make it an affordable and standardized accommodation.
OYO rooms are India’s largest branded network of budget hotel chains. It currently operates across 400 Indian cities including major metros, regional hubs, leisure destinations, and pilgrimage towns, and was valued at $9.6 billion in 2022.
They offer the hotels to their clients and retain a proportion of the profits.
OYO Rooms is a budget hotel aggregator in India. In order to standardize different measures in each room, OYO Rooms partners up with hotels, including free wifi and breakfast, flat-screen televisions, spotless white bed linens, toiletries with a brand name, 6-inch showerheads, drinking cups, etc.
OYO uses a mix of demographic, geographic, and psychographic segmentation strategies to understand the changing needs of the customers in the competitive market. OYO segments the market in the following manner:-
OYO Townhouse targets Millennial travelers
OYO SilverKey caters to the needs of corporate travelers
OYO Vacation Homes targets people who come on vacation at the beach or a villa on an exotic island
OYO Life provides residential space
Targeting strategy is the cornerstone of the product development process. OYO uses a differentiated targeting business strategy for different product categories.
Corporate tie-ups for airline travelers
Tours and travels
College students or working professionals who are in search of fully managed homes on long-term rentals at an affordable price
OYO uses a value-based positioning strategy for its customer by providing:-
Standardized budget hotels
Luxurious productive place
Open grass greenery
Better room service
Marketing Mix of OYO Rooms
As OYO Rooms concentrate on co-branding, they operate differently from OTAs (Online Travel Agency). They state that they are working with zero-to-2-star hotels and guest houses, ‘standardizing’ them and getting them customers through their website and apps. Usually, other hotel aggregators simply connect the customer with the hotel by listing hotels on their website and taking a commission as their revenue. They would work out a deal with the hotels with a minimum order guarantee per month and are able to provide discounted rates and deals on the room rates compared to the rates provided by the hotels directly to a normal guest.
OYO’s market coverage has swiftly increased because of being listed with travel aggregators like MakeMyTrip, clear trip, and hotels.com. Their aim is to target small business travelers and budget tourists to eminently swift-cash and that works in favor of OYO because revenue gets realized quicker too.
Product in the Marketing Mix of OYO
Oyo has a wide range of products and services that they offer to their customer as per their need. OYO Rooms, OYO Hotels & Homes has a multi-brand approach. These include:
OYO Townhouse
OYO Home
OYO Vacation Homes
SilverKey
Capital O
Palette
Collection O
OYO LIFE
YO! HELP
Promotion/Advertising in the Marketing Mix of OYO
OYO prefers to promote via various social media sites such as Facebook, Twitter, Instagram, Pinterest, etc. With its exclusive offerings and reduced costs, OYO uses the digital platform to draw new customers.
OYO organizes several online campaigns such as #AurKyaChahiye on YouTube, #OneForEveryone contest, #OYOnauts, Father’s Day Celebration campaign, etc.
Many of the promotions have featured artists from Bollywood to make them more appealing. Sonu Sood is the brand ambassador of OYO.
Brand Endorsement by Sonu Sood
Pricing in the Marketing Mix of OYO
The strategy of OYO Rooms is to attract customers with a lower room price than the hotel’s base price.
The primary objective is to provide an unequaled price that suits the user’s budget. The room price varies depending on the location and luxury of the hotel, between Rs. 399 and Rs. 4000.
Overall OYO Rooms follows a very sensible approach, aimed at providing rooms with outstanding facilities at a moderate rate and generating customer loyalty.
Place in the Marketing Mix of OYO
Oyo rooms work fully online where one can book the available hotels at an approximate cost either via an app or through online platforms.
Once booked with a confirmation one can avail of the service on reaching the booked hotel on a specific date.
OYO Rooms Online Booking
People in the Marketing Mix of OYO
Oyo team comprises 25000 young and professional people who deliver maximum both for the company and individual growth.
With a dynamic team, OYO provides excellent customer service, creates a positive experience for its customers, and in doing so markets its brand to them.
OYO started with traditional marketing to make people aware of its brand. It used billboards, TV ads, print media, flyers, and even taxi ads, especially in cities and tourist areas. These methods helped OYO reach travelers who were not very active online.
OYO Billboard
OYO also focused on local marketing by working with travel agents and sponsoring events. This helped build trust and made OYO a familiar name among different types of travelers. However, while billboards and ads caught people’s attention, they couldn’t engage customers like digital marketing. That’s why OYO later shifted to online marketing, using social media and personalized ads to connect with more people in a better way.
OYO Digital Marketing Strategy
OYO has shifted its business model from hotel aggregator to the fastest-growing chain of franchises offering OYO hotels (OYO flagships, townhouses, studio stays Collection O, Premium), living spaces (OYO Life), and workspaces (OYO Workspaces).
Marketing Approach Adopted by OYO Rooms
Prices in the real estate sectors are rising day-by-day still OYO has managed to provide the best places to people at an affordable price. The Internet brought the world closer and digital media became a huge marketing platform. In today’s digital and connected world, it is important to stay ahead of the competitors. OYO makes use of a 360-degree marketing strategy. OYO used all forms of digital as well as traditional media to reach its customers. Traditional media include both print and television whereas digital media include Google search ads, social media ads campaigns, and OYO’s own website and app.
Assi Reach Gaye? | OYO Rooms Official | Roadtrip
Search Engine Optimization For OYO Rooms
Search Engine Optimization is done to ensure maximum traffic to the website by using particular keywords that have the highest searches from their customer. They understood their customer’s needs and intentions and updated their website accordingly. This ensured people searching for hotels would be redirected to their website.
Social Media Marketing Strategy of OYO
OYO uses Facebook to share location-based posts, promotional posts, and posts related to the detailed progress of the organization. These posts helped people to browse destinations to travel, and regular promotional posts provided customers with offers and discounts, encouraging them to book OYO.
OYO reposts pictures taken by travelers and users of OYO on their Instagram handle. Along with this strategy they implemented Facebook marketing strategies to Instagram. This strategy leads to an engagement rate and encourages people to tag OYO in their posts.
OYO Meme Marketing Strategy
OYO often works with influencers who create content around travel. This is either done via posts or re-posts. These posts are about the experience these influencers have during their vacations and not about their stay at OYO. The core idea of OYO’s influencer marketing is that you will need a place to stay whenever you go out for a vacation and here comes influencers’ experiences.
OYO tweets as well as retweets informative content such as award wins and events, news as well and companies’ CSR activities which adds credibility to the brand in a not-so-obvious manner.
OYO is a well-established online portal for hotel bookings in India that can grow tremendously with the right digital marketing practices and the use of resources. The OYO marketing strategies put up in this article are for a better understanding of the reader. And, also to help the reader shape their ideas into creative campaigns that could be utilized in their business.
FAQs
What are OYO Rooms?
OYO Rooms is India’s largest branded network of hotel chains offering standardized rooms to their customers at an affordable price.
How are OYO Rooms different from online travel agencies?
When you book OYO Rooms, you get a guaranteed OYO experience across all the hotels unlike an online travel agency or marketplace where end-user service is not standardized.
What is OYO marketing strategy?
OYO uses a mix of traditional and digital marketing. It started with billboards, TV ads, flyers, and local partnerships to build trust. Later, it focused on digital marketing, using social media, personalized ads, and influencer collaborations to reach a wider audience.
Does any payment need to be made at the time of booking?
Customers have the option to either make an advance payment or at the time of the hotel’s check out.
I am a hotel owner. How can I partner with OYO?
In order to partner with OYO Rooms, you have to visit partner.oyorooms.com and fill up a simple OYO rooms registration form by stating your name, mobile number city, and property type i.e. home, commercial, and hotel and click on Become an OYO to submit this form.
How much does OYO pay to the hotel owner?
OYO Rooms charges a commission of 22% from its hotel partners. However, this commission does vary according to the services provided by the brand.
According to media citations, hospitality startup Oyo has begun preparing its draft red herring prospectus (DRHP), which would be its third attempt to go public, by the first quarter of the upcoming fiscal year. Ritesh Agarwal, the founder, is currently rearranging his shareholdings, which is connected to the upcoming IPO.
According to media reports last week, Peak XV Partners has already sold shares worth $80-90 million, while early investors, Lightspeed Venture Partners and others, are seeking to sell their shares in the Gurgaon-based company. Agarwal has entered into debt finance agreements that include the IPO plans in order to execute a public offering this year. Media reports emphasised that Oyo’s goal is to file well before the conclusion of the first quarter.
Agarwal, SoftBank group, and HNI are Expected to Retain Key Space
In order to invest now and benefit from an IPO, the new investors—mostly family offices—are interested in the IPO link. Before the anticipated IPO filing, three significant shareholder groups—founder Agarwal, SoftBank Group, and HNI family offices—are anticipated to possess a significant portion of the company’s capital table, indicating a concentrated ownership structure.
According to the most recent data on Tracxn, Agarwal and SoftBank share more than 75% of Oyo parent company Oravel Stays; however, the founder’s stake may increase further as a result of his new investment in the company, which he founded in 2012.
According to an Oyo representative, the firm has not yet decided on the IPO’s timeline. Oyo is positioned alongside late-stage consumer internet companies like Zepto that are considering public markets this year as a result of the IPO rush. After the public markets embraced new-age companies in 2024, at least 20 startups are anticipated to enter the market this year.
Oyo Making Significant Efforts to Launch IPO
In January 2023, the stock market authority rejected Oyo’s initial 2021 effort to go public. After that, the business submitted a new application for a smaller initial public offering (IPO), but it withdrew it in May of last year and chose to raise money privately. At a valuation of $2.4 billion, it concluded a fundraising round of INR 1,457 crore. From a height of $9 billion in 2021 to the present $4 billion, the SoftBank-backed company’s valuation has been erratic, reflecting a resurgence in sustainable operations.
Oyo’s biggest investor, SoftBank, had cut its valuation from $3.4 billion to $2.7 billion in 2022. Oyo’s updated confidential filing called for a 40–60% lower initial public offering (IPO), whereas its initial proposal was for a $1.2 billion (INR 8,430 crore) offering. Although specifics are still being completed, its most recent IPO is probably going to be less than $1 billion. However, at a valuation of about $4 billion, it is anticipated to fetch a higher price in the ongoing stake sale discussions. In the meantime, Oyo has become profitable, and its cash balance has strengthened thanks to recent fundraising.
In FY24, Oyo reported its first-ever profit after taxes of INR 229 crore. In the first quarter of FY25, the company reported a profit of INR 132 crore. This performance has been fuelled by strategic investments in Europe as well as expansion in Southeast Asia, India, and the US.
The Ghaziabad Police have closed more than 50 hotels for “fraudulently” utilising OYO’s name, according to a statement released by the travel booking website. The action follows the filing of a formal complaint by the business and the submission of a police report to the licensing body.
OYO acknowledged in a statement that it has begun a cooperative operation with the Ghaziabad Police to crack down on unapproved hotels that were deceiving clients by using the OYO name without authorisation. OYO has previously sent legal notifications to several hotels telling them to take down its branding, but many of them disregarded the orders. According to the company’s official letter, police visited the locations that were identified as part of the investigation and warned the management about the legal repercussions of using false OYO branding.
Special Drive Conducted to Catch Offenders
The drive was specifically targeted at these unapproved outlets that have proliferated and were abusing the “OYO” brand name on their boards, according to Rajesh Kumar, the acting assistant commissioner of police in Ghaziabad. They lacked authorisation to operate. In accordance with protocol, these businesses were located and sealed.
Speaking about the effects of these fake establishments, Varun Jain, Chief Operating Officer of OYO India, said that these unapproved hotels frequently mislead guests. To protect OYO’s visitors and the integrity of its brand, the company worked with law authorities to take action against fraudulent hotels that use OYO’s name. This crackdown comes after OYO’s larger initiatives to safeguard consumers from dishonest services and preserve the integrity of its brand.
OYO Modifies Check-in Policies
One of the top travel and hotel booking websites in India, OYO, announced a significant policy change for its partner hotels on 5th January. The new rules state that unmarried couples would no longer be permitted to check in at the establishments. According to the corporation, the new regulation will initially only be in effect in Meerut, Uttar Pradesh.
According to Pawas Sharma, OYO North India’s Region Head, maintaining responsible and safe hospitality practices is a priority for the brand. In addition to upholding individual liberties, the business must cooperate with law enforcement and local communities to provide a peaceful workplace.
The business added that unmarried couples might not be accommodated, and hotel partners have the right to turn down reservations in accordance with regional customs. OYO claims that the action is a part of a larger plan to respond to community input and change its reputation as a reliable and secure lodging option for families, business travellers, students, religious pilgrims, and lone travellers.
OYO’s ruling came after civil society organisations, especially in Meerut, repeatedly called for stronger laws prohibiting unmarried couples from staying. Residents of other cities have submitted similar petitions, so the company decided to test the policy in Meerut and, depending on response, consider extending it to other areas. The policy is now only applicable in Meerut. OYO states that the feedback from the initial launch will determine whether or not the guidelines are extended to more places.
One of the top travel and hotel booking websites in India, OYO, announced a significant policy change for its partner hotels on 5th January. The new rules state that unmarried couples would no longer be permitted to check in at the establishments. According to the corporation, the new regulation will initially only be in effect in Meerut, Uttar Pradesh.
According to Pawas Sharma, OYO North India’s Region Head, maintaining responsible and safe hospitality practices is a priority for the brand. In addition to upholding individual liberties, the business must cooperate with law enforcement and local communities to provide a peaceful workplace.
Empowering Hotel Partners
The business added that unmarried couples might not be accommodated, and hotel partners have the right to turn down reservations in accordance with regional customs. OYO claims that the action is a part of a larger plan to respond to community input and change its reputation as a reliable and secure lodging option for families, business travellers, students, religious pilgrims, and lone travellers.
OYO’s ruling came after civil society organisations, especially in Meerut, repeatedly called for stronger laws prohibiting unmarried couples from staying. Residents of other cities have submitted similar petitions, so the company decided to test the policy in Meerut and, depending on response, consider extending it to other areas.
The policy is now only applicable in Meerut. OYO states that the feedback from the initial launch will determine whether or not the guidelines are extended to more places.
OYO’s Business and Financial Dynamics
Redsprig Innovation Partners, the company founded by Ritesh Agarwal, contributed INR 550 Cr, or around $65 million, to OYO last week. In order to obtain funds, the business issued 12.91 Cr equity shares at an issue price of INR 42.6 per share, according to its filings with the Ministry of Corporate Affairs.
OYO is a hospitality services firm that was founded in 2012 by Agarwal and offers reasonably priced lodging options to clients worldwide. It states that it provides over 40 integrated products and solutions in over 35 countries, including Southeast Asia, Europe, and India. In the second quarter of the current fiscal year, which concluded in September, OYO’s parent company reported a net profit of INR 158 Cr. This follows a profit of INR 132 Cr in the previous quarter (Q1 FY25). This represents a 19.6% sequential increase. From INR 1,413 Cr in Q1 FY25 to INR 1,578 Cr in Q2 FY25, the company’s revenue increased by 12%.
