Chinese Internet giant Tencent is planning to invest $300 to $500 million at a valuation of over $2 billion in OYO Rooms. It will be the second time when Tencent and SoftBank would invest second time together in India. They invested in cab firm Ola together. So far, Alibaba has been the preferred partner for SoftBank. The duo invested in four companies including Paytm, Paytm Mall, Snapdeal.

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This comes a few months after SoftBank reportedly asked OYO to look for a new investor for the fresh round to make its existing marquee investor the SoftBank Group of Japan to chip in with its own share of capital. OYO raised $250 million, mostly from SoftBank last September. In April, OYO raised $10 million through China Holding Group. It was valued at $850 million during the last funding round. Founded in 2013 by Ritesh Agarwal, OYO has so far secured fundings of about $442 million from SoftBank, Lightspeed, Hero Moto Corp and others.

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OYO recently launched the operation in China and is running 11,00 hotel rooms in 26 cities and plans to utilise new fundings into the expansion in the Chinese market. Also, OYO has converted its business model from aggregation to a pure-play franchise model with the aim of delivering uniform experience and pricing.

OYO is eyeing budget-hotel segment with new investments as the International budget-hotel market is still untouched in the which gives direct benefit to the likes of OYO