Oyo Rooms Churns Out Rs 6800 Cr Revenues In 2019; Hosts 18 Crore Guests Globally, Gross Margin Increase By 4.1%
Indian hospitality startup OYO Hotels and Homes, the world’s leading hospitality chain has announced its financial results for FY 2019 (April 2018 to March 2019). According to the reported audited financials, Oyo’s consolidated revenue stands at USD 951 million which is 4.5X YoY higher from FY2018 when the company reported a revenue of USD 211 million.
Oyo’s Consistent Growth
Oyo has been into the business since only 6 years now and the feat it has already established is appreciable. The company’s business across markets today is seen to evolve through three key growth stages:
- When operations start in the new markets, the focus of the company is mainly on scale and presence.
- On achieving scale and presence, the focus is on creating a strong brand resonance and ensuring improved gross margin, for the value proposition brought in, while continuing to invest in accretive growth.
- Finally, the focus of the company is to maintain strong brand preference along with ensuring to have a clear path to profitability, enabled by accretive growth, operational excellence, and strong gross margin.
Speaking of this, the business operations in India contributed to nearly 63.5% or USD 604 million of this consolidated figure as the business clocked a 2.9X (y-o-y) growth, in FY 19.
Nearly 36.5% or USD 348 million was contributed by the company’s operations outside India, primarily China, signifying its strong commitment towards building a sustainable global business at scale with improved operating efficiencies.
Some Highlights From Oyo’s Financial Numbers
The company reported an increase in both daily guest check-ins across its network as well as an increase in hotels and asset owners across the world. With over 43,000 asset partners, OYO hosted over 180 million guests from 120+ nationalities between January – December 2019.
Oyo also reduced losses from 24% to 14% of revenue in FY19 to USD 83 million, in mature markets like India. In 2019, OYO also continued to build a loyal guest base, with over 90% revenue coming from repeat and organic user base with repeat alone contributing to 73% of revenues.
Since China and other international markets were in development and investment mode during that time, they contributed to 75% of the losses for FY19.
These markets constituted 36.5% of the global revenues. While consistently improving operating economics in mature markets like India where it’s already seeing an improvement in gross margins, the company is determined to bring in the same fiscal discipline in emerging markets in the coming financial year.
The company’s gross margin in India increased from 10.6% in FY18 to 14.7% in FY19 indicating the strength of its business model and a positive correlation between market share and economics.
- The OYO app is now among Top 3 Hotel booking apps globally with over 2.3 million downloads till October 2019 which has now increased to 10 million+ downloads.