The budget hospitality chain OYO has been expanding to various countries for a long time. After China, Australia and many other countries, the company is now foraying into Japan which is the world’s third-largest economy.
The Gurugram-based hotel chain lately raised $800 million in its latest round of funding that was led by SoftBank’s Vision Fund, following which, the valuation of the company reached $5 billion.
The move also comes less than a year after the hospitality company entered China in December last year, a geography that it has identified as a core market, alongside India. According to the sources, Japan could also be the company’s next major market, after India and China.
The step to enter Japan has also been driven by the expected growth in the country’s hospitality sector, which is anticipated to witness a significant growth over the next two years, given its capital city, Tokyo, is scheduled to host the 2020 Summer Olympic Games.
According to a report, in Japan, accommodation accounts for on average 28% of tourist spending, second only to shopping. Last month, CEO Ritesh Agarwal stated that of the overall $1 billion that OYO will raise, about $600 million will be used by the company to further establish its presence in China, with the rest being directed towards India, where it is the leader and other international markets.