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OYO Townhouse, the mid-market segment of budget hospitality chain OYO Rooms, will not be entering any new cities for now.
Under the category, the company is planning to expand its business vertically — in cities it already exists.
“Right now, the plan for OYO Townhouse is to go deeper than to go broader. We are focussing on coming up with more projects in the cities where we already have a presence rather than announcing projects in new cities,” Ritesh Agarwal, Founder and CEO, OYO, told BusinessLine .
“All the Townhouses are reporting 90 per cent occupancy rate. This shows high demand for the product. So instead of experimenting with more locations, we would rather focus on new projects in the same cities.”
Future aspirations
The company is also looking at entering more verticals in the hospitality industry. Agarwal said: “The focus is to become stronger in the food and beverages, and banquet segments. In future, you might see places which we acquire and revamp just for the purpose of banqueting.”
Insisting that OYO will soon enter the luxury segment, he said: “A year ago, we were asked about our plans to enter the mid-scale segment, and now we are there. In the long term, the opportunity exists for the luxury segment, too. The question is not whether or not, the question is when.”
Case against Zostel
OYO was in talks to acquire fellow budget hospitality chain Zostel in 2015, but the deal had fallen apart .
Things seem to have gone further downhill between the two. Earlier this week, an OYO statement said the company had filed a case against the founders of Zostel alleging criminal breach of trust, cheating and misrepresentation of data.
Agarwal refused to comment on the complaint, but said: “At this point, it’s very hard to talk about anything else. We can only talk on it after the decision is taken by the court.”
OYO Townhouse buildings have 30-150 rooms and are currently present in 13 cities. The price under this category varies from ₹2,500 to ₹5,000.
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