Oyo Expands Into Food & Beverage

Oyo on Thursday announced its foray into the food and beverage (F&B) segment, with plans to roll out in-house kitchens and quick service restaurant (QSR) carts at 1,500 of its company-serviced properties by fiscal 2026. 

The hotel company will first bring these services to the Townhouse by Oyo brand.

The decision follows a pilot that started in January across 100 hotels in several cities, Delhi, Bengaluru, Hyderabad, and Gurugram. Oyo said the feedback was positive, prompting the broader rollout. Guests will be able to order food through the Oyo app and other booking platforms by selecting a “Kitchen Services” option.

Oyo projects that these services will drive 5–10% additional revenue per hotel. For budget properties where room rates are lean, this can improve margins.

F&B and Indian Hospitality

Traditionally viewed as an ancillary offering, food and beverage services have emerged as major contributors to hotel revenues. Today, F&B contributes between 35%-50% of total income for many properties, especially those in upscale and full-service segments.

Hilton has said that F&B accounts for 35–40% of its revenue in South Asia. Food-and-beverage offerings tailored to local palates are increasingly critical in markets like India, Alan Watts, Hilton’s president for Asia-Pacific, had told Skift earlier.

This is mostly boosted by walk-ins, destination dining, and Meetings, Incentives, Conventions and Exhbitions (MICE) business.

“There’s genuine demand for hotels in suburban, lesser-known towns. This is due to increasing trade activity and consumer patterns. Consumption of food and beverage and banqueting have gone through the roof,” Jaideep Dang, managing director, Hotels & Hospitality Group at JLL, had told Skift earlier. 

This shift reflects growing demand for quality food, whether guests dine in or order out. IHCL’s food delivery app Qmin is one example. It offers dishes from Taj hotels, supports real-time tracking, and allows guests to order from multiple restaurants in a single transaction. Qmin helped IHCL stay relevant during the pandemic. Launched in collaboration with Tata Digital, the app supports personalization, real-time tracking, and multi-restaurant orders.

Radisson’s new dessert brand, Meetha by Radisson, and its global culinary rollouts are also part of this trend.

Last year, Delhi government said it would allow restaurants to operate round the clock in the Delhi Aerocity area near Delhi airport, which is a hotel hub.

What Oyo Will Offer

With its Townhouse Café brand, Oyo is targeting affordable and convenient dining options in the midscale and budget hotel segment. The offering will include ready-to-eat items, regional meals, and continental staples through lobby stores and QSR carts, particularly suited for on-the-go guests, late-night travelers, and those seeking snacking options without stepping out.

Depending on each hotel’s infrastructure, Oyo will install either full kitchens or smaller pantry setups.  

“To support this, Oyo is developing a network of trusted F&B experts in key cities such as Delhi, Mumbai, Bengaluru, Hyderabad, Pune, Indore, Kolkata, Jaipur, and Lucknow,” Oyo Chief Operating Officer, Varun Jain, said.

Oyo has a large presence in Tier 2 and 3 cities, where branded dining options are limited.

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