Budget-hotel chain start-up OYO Rooms, has set its sights on more than doubling its total room count to hit 1,80,000 rooms by the end of calendar year 2018, up from 70,000 rooms at present, Ritesh Agarwal, founder and CEO, told BusinessLine .

Th start-up, which has raised $450 million in four rounds since its inception, plans to ramp up its 2,700-strong team with 1,000 additional hires across functions at the associate level, to support its growth trajectory.

While 50 per cent of the rooms still fall under budget pricing of ₹1,000-1,500, the company has moved further up the value chain with OYO Townhouse, a new premium product launched last year, at pricing upwards of ₹ 2,400-4,000. The company also offers homes, which has a differentiated experience to travellers in leisure destinations, at ₹3,000 a night (for a three-room home).

Branding spaces

“Since January 2016, we have been working towards moving away from the aggregator model to a completely franchised model, where we partner with independent unbranded hotels, and renovate, standardise and brand them into beautiful living spaces. Today, over 90 per cent of our rooms are under the franchised model, and soon it will be 100 per cent,” said Agarwal.

“We on-board 10,000 rooms and 500 hotels every month, execute property makeovers within 3-15 days, sign up franchisees in less than five days and provide 75 per cent occupancy to hotels across the country ,with no TV advertising for the last 18 months. We are ramping up our corporate team with 1,000 new hires across functions.”

According to Agarwal, the company’s average room revenue has grown from ₹1,430 in 2017 to ₹ 1,500 at present, fuelled by Townhouse supply.

He said the company is targeting $600 million in annualised revenue run rate by the year-end, up from $300 million last year. “We receive 17 per cent commission on room bookings from our partners, and have been doubling growth over the past few years. We are also looking to increase NPS (net promoter score) from 50 per cent at present, to 55 per cent by next year-end.”

Asked about his aspirations to become a global brand, Agarwal said “We are already a global company, with presence in Nepal and Malaysia, which are our entry points into the South and South-East Asian markets.”

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