O2 Spa, the country’s largest chain of spas, has diversified into wellness and personal care products under Ode and iHow brands. It has renamed its overall business as International House of Wellness.

With more than 100 spas in India in airports, hotels, malls and standalone ones, and over 20 outlets in West Asia, it is diversifying into larger format villa mode spas and expects to set up more than 30 of them during this year itself.

“While we retain the O2 brand for the spa network, the overall business will now be referred to as International House of Wellness, under which there will be three verticals of O2 Spa covering salon and spa services, Ode for personal care products and iHOW for wellness and tea brand,” said co-founders Ritesh Reddy and Swapna Reddy.

Interacting with BusinessLine at their newly set up villa format spa, which will be promoted as neighbourhood Spa, the Reddys said currently they are sourcing these products from some nine vendors but soon plan to set up a manufacturing unit on a 10-acre site near the Hyderabad international airport. Globally, the spa and wellness business is rapidly expanding, and in the US alone, it is estimated at $30 billion. However, in India, it is relatively small and the organised spa business is about $200 million and growing.

“Currently, we have presence through 11 outlets in airports, 50 plus in star hotels, 15 in malls and other locations. By taking to villa concept, we want to transform to a neighbourhood spa and wellness centre,” Ritesh said.

“Having raised about $15 million through a private equity deal from Banyan Tree Fund, we have grown the entire chain under the company-owned and company-managed model. While we acquired one spa chain, we are in talks with two chains for acquisitions,” he said.

Under the Ode range of personal care and iHow wellness products, a number of products have been lined up and these will be gradually introduced, Swapna said.

The promoters hinted that they may raise another round of funds to fuel the next phase of growth. The company is planning a capex of about ₹30 crore this year and expects to close this year with a turnover of ₹130 crore up from ₹86 crore last year.