Gurgaon-based budget hotel aggregator OYO Rooms is close to raise fresh funding of about $300-500 million from Chinese internet giant Tencent, reported Times of India.

The funding will likely to value OYO at $2 billion, which is almost double the valuation of $850 million from SoftBank's Vision Fund.

"The company is engaged with Tencent, and a term sheet is likely to come in. There’s a bunch of other investors also in talks, but those are preliminary at the moment. The fundraise is largely to grow the China business," a source told the Times of India.

"Getting a backer like Tencent will help OYO grow aggressively in China," said the report citing an another source.

If this plausible funding goes through then it will be OYO's first round of financing not led by SoftBank.

Also Read - Tencent Looking For More Investment Opportunities in India

Founded in 2013 by Ritesh Agarwal, OYO has also held talks with other Chinese companies and a few other financial investors for the funding. The company has so far raised a total of $450 million out of which Softbank has contributed about $400 million and rest came from Sequoia Capital, Lightspeed Ventures and Hero Enterprise, among others.

OYO, which recorded a gross booking value of $500-600 million, has recently announced its expansion into 26 Chinese cities, making it the third overseas market for the company after Malaysia and Nepal.

Tencent, which has backed Flipkart, Ola, Hike and Gaana, among other, is also reportedly in talks to participate in fresh $100-150 million funding round of baby products startup FirstCry and recently led the $50 million funding round of NewsDog, a Gurgaon headquartered mobile-based news and entertainment content aggregator.

Tencent, its Chinese rival Alibaba Group, and Japan’s SoftBank Group Corp have become increasingly aggressive in India the past 12 months, picking up stakes in some of the country’s most richly valued companies and driving up valuations to stratospheric levels in the process.

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