Global hotel and home chain OYO has already facilitated investments over $2 billion (Rs 14k crores) so far in capital expenditure by banks, individuals and the company apart from Rs 45 crore enabled last month through its Cash in Bank initiative
Global hotel and home chain OYO said that it has already facilitated investments over $2 billion (Rs 14k crores) so far in capital expenditure in its partner hotels by banks, individuals and the company apart from Rs 45 crore enabled last month to over 2,000 owners through its Cash in Bank initiative launched in May this year (as part of its OYO Partner Engagement Network OPEN initiative) to offer collateral-free loans for renovating or upgrading the properties. The company said it will further enable capital infusion worth more than $850 million (Rs 6k crores) over the coming six months on enhancing design and infrastructure.
OYO also penalised more than 1,000 building owners for not being able to meet the quality norms under OYO’s 3C evaluation programme focusing on quality accommodation even as it has ‘awarded’ more than 9,000 owners under its OPEN programme. “Penalty can vary from their exit from the platform or a stringent fine while awards could be capital,” a source aware of the matter told Financial Express Online.
Helping property owners with capital support gains significance for OYO not just to retain them on the platform but also to attract more property owners who often fund the renovation of properties that stresses their cash flows. The company saw more than “2,000 owners applying for capital support within a month of the launch of its Cash in Bank programme,” Chief Supply Officer Ayush Mathur said in a statement even as OYO has already “enabled interior capex with a 170 crore disbursal pipeline by the end of July,” he added.
OYO currently has more than 9,000 building owners on its platform across over 260 cities in India. Its combined portfolio includes over 23,000 hotels and 46,000 vacation homes globally and is present in over 800 cities in 80 countries. OYO’s founder Ritesh Agarwal, which currently holds 10 per cent in the company, would be increasing its stake to 30 per cent following the partial exit by its early investors Sequoia Capital and Lightspeed. The partial shares would be acquired by Agarwal for $2 billion. The two investors would reap $1.5 billion in partial exit from OYO.