Ritesh Agarwal's OYO parent Oravel Stays plans to launch 13 premium hotels this year

Oravel Stays, the parent company of Oyo, recently unveiled its plan to expand its premium hotel segment. By the end of this year, Oravel aims to launch 13 new hotels under its Palette brand.

The expansion builds on the success of a pilot project that saw the establishment of 10 Palette resorts across various Indian cities, including Jaipur, Hyderabad, and Mumbai, among others. The total count of Palette hotels will reach 23 by year-end.

Reviving the self-operated model

Oravel Stays is revisiting its self-operated model, which was paused in 2020. The Palette hotels will adopt this model, similar to Oyo's operational strategy, allowing for a more controlled and quality-focused service delivery.

Interstingly, The approach is not expected to be capital-intensive, indicating a smart expansion strategy that leverages operational efficiencies. 

Morbi: A key market for Oravel's first self-operated palette hotel

The choice of Morbi for launching the first self-operated Palette hotel is strategic, given its status as India's ceramic capital and a significant economic hub in Gujarat.

With over 800 tile factories, Morbi is at the heart of India's tile production, attracting business travellers and investors. The upcoming Palette Hotel in Morbi is poised to cater to this demographic, offering 48 spacious rooms, conference facilities, a swimming pool, and other premium amenities.

“We are excited to launch our first self-operated Palette hotel in Gujarat, and what better city to start with than Morbi. With its booming economic scene and growing business opportunities, Morbi is an important market for us,” said Aditya Sharma, Business Head, Oravel Stays.

Focusing on business travelers 

Oravel's expansion into Morbi and the broader Palette initiative is closely aligned with the needs of business travellers, particularly those visiting the region's bustling ceramic sector. 

The Gujarat government's focus on developing the ceramics industry and the anticipated operationalization of a 425-hectare ceramics park are expected to further boost business travel and demand for high-quality accommodations. 

Oravel's Palette hotels are strategically positioned to meet this demand, offering a premium hospitality experience that supports Morbi's growth story.

Oyo's profitable growth and future outlook

The launch of new Palette hotels comes at a time when Oyo is experiencing financial growth, having reported its second consecutive profitable quarter in Q3 FY24. The expansion into the premium hotel segment reflects Oyo's broader strategy to diversify its offerings and tap into new market segments.

Oravel Stays is working to improve its place in the hotel business by focusing on quality, managing its operations well, and choosing its market entries strategically. It aims to provide travelers with high-quality places to stay that suit the changing needs of both business and leisure trips.