Why Oyo Is Doubling Down on Its Company-Serviced Hotels

India’s growing purchasing power is driving Oyo towards premiumization, but it’s doing it Oyo style.

Oyo has said it is aiming to double the share of company-serviced properties in its booking revenue from 22% to 44% in the current financial year.

The company that currently operates 1,300 hotels in its serviced segment across 124 cities also plans to expand the portfolio of these hotels to 1,800 properties across 300 cities. These are primarily under its mid-segment brands Townhouse Oak, Capital O and Palette, and premium brand Sunday.

The launch of company-serviced hotels in September 2023 marked Oyo’s departure from its franchise model.

According to Oyo, it will focus on leisure cities, pilgrimage destinations, and business corridors where demand remains strong for the expansion.

What is Driving This Decision? In its statement, the hospitality company said that these hotels have double the average occupancy as compared to franchise hotels. These properties also get a higher customer rating, it added.

Last December, Oyo said that it achieved 250% growth in this segment within just a year of its launch.

Varun Jain, chief operating officer at Oyo said, “The program is in line with Oyo’s strategic focus for 2025 for the India market, which aims to drive profitability by enhancing the overall guest experience.”

The company said that the company-serviced hotel segment is Oyo’s fastest-growing business segment globally. “This highlights their higher revenue-generating potential, driven by standardised operations, superior service quality, and enhanced customer experience,” it added.

Oyo’s Premiumizat