One of India’s leading startups, Oyo rooms has planned to invest $50 million to enter into the Philippines.
The company is on an expansion spree where it has already started its operations in other South Asian markets, including Indonesia and Malaysia. In the last 18 months, the Gurugram based startup has launched its operations in countries like Nepal, the United Kingdom, the UAE, and Indonesia.
As per the company’s own calculations, India and China remain its biggest markets. The Oravel Stays Pvt Ltd, who run Oyo is also geared up to begin its operations in Japan ahead of the 2020 Summer Olympics. Japan is expected to witness a fierce hotel industry war, especially in the budget segment ahead of the 2020 Olympics.
The Ritesh Aggarwal run company secured $1 billion in funding from Japan’s SoftBank Vision Fund last September and since then the company has channelized these funds into expanding its overseas business. The investment has provided the hotel aggregator with necessary space to explore the international markets at a rapid pace.
Regarding the expansion, Abhinav Sinha, chief operating officer at Oyo said, “We believe that by setting foot in the Philippines, we are advancing our vision of strengthening our foothold in Southeast Asia. Our growth in the country will be fueled by strong local leadership and a team of young hospitality enthusiasts.”
Financial daily, Mint has reported that, at the moment, Oyo is expected to start its operations in Manila, Tagaytay, and Cebu with 21 hotels and expand to 10 cities by 2020.
Ankit Arya would be the country head for the unicorn startup in the Philippines. The startup has been consolidating its international leadership with top senior executives hires for the Chinese markets and country heads for UK and Malaysia.
Moreover, it has also set aside over $100 million to expand its operations in Indonesia over the next five years. As per the company, it would explore both the franchise and lease models in the Philippines for its business there. The country has a considerable market and mobile penetration which Oyo is willing to exploit.
However, the entry into the Philippines markets is not going to be easy for Oyo. A similar startup, RedDoorz, an Indonesian based company has also launched its operations in the country in July 2018. This is the third Southeast Asian market RedDoorz entered after Singapore and Indonesia. Notably, it is funded by the World Bank Group’s private investment arm International Finance Corporation, InnoVen Capital and Asia Investment Fund including others.
Source: IB Times