SoftBank-backed OYO Hotels & Homes on Monday announced it has elevated India and South Asia CEO Aditya Ghosh to its board of directors.
The company also announced the appointment of Rohit Kapoor, who is currently leading its new real estate businesses, as its new CEO for India and South Asia.
Ghosh joins OYO founder and group CEO Ritesh Agarwal and executives from Baja Corporation, SoftBank Vision Fund, Lightspeed India and Sequoia Capital India on OYO’s board. In his new role, he will focus on safety and security, customer experience, corporate governance, revenue management and stakeholder communications, per a statement issued by the company.
“Aditya’s strong business acumen, problem solving capabilities, passion for building an organization with strong corporate governance and a high performing work culture that thrives on principles of diversity and inclusion, makes him the perfect choice for this larger and more strategic role, at a global level,” said Agarwal.
Prior to joining OYO, Ghosh spent over a decade at IndiGo, India’s largest airline by market share.
The reshuffle comes a year after Ghosh joined the startup and at a time when OYO has been making headlines for its mounting losses.
In the fiscal ended March 2019, the company reported losses worth Rs 2,384.69 crore and revenue of Rs 6,457 crore. Its total expenditure during the fiscal stood at ₹9,027.53 crore, up almost five times from the previous year.
OYO has also been in the news for Agarwal’s convoluted bid to increase his stake in the company. The OYO founder is using a loan from lenders including Japanese banks Nomura and Mizuho to bankroll the bid using his existing 9 per cent stake in the startup as collateral.
The guiding hand of investor SoftBank, which has put in nearly $1 billion in the startup, is evident in these machinations. The Japanese investor has closely worked with Nomura on several deals in the past.
OYO, meanwhile, is staring at other challenges too. It has attracted the ire of hotel operators who have been complaining about being blindsided by fee increases. In fact, a group of hotel operators in the southern city of Bengaluru have slapped criminal charges on the startup for allegedly withholding money due to unfair fee increases.
OYO reportedly charges a roughly 20 per cent franchise fee on room revenues. Hotel operators, however, claim that it charges much more.
OYO is currently present in 800 cities in 80 countries, including the U.S., China, Europe, the UK, Malaysia, Middle East, Indonesia, and Japan. The company counts India and China among its largest markets.