TBO Tek Limited IPO

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TBO, was conceptualized in 2006 as a technological solution to simplify airline ticket booking for travel agents dealing with multiple airlines. This was in response to the fragmented nature of the travel industry, which has traditionally been slow to adopt technology. Their mission has consistently focused on empowering the travel industry through technology.

Global Operations and Impact

As of December 31, 2023, their company boasts a global presence, servicing buyers and suppliers in over 100 countries. You stand as a leading travel distribution platform globally, in terms of Gross Transaction Value (GTV) and revenue from operations for Fiscal 2023. Their offerings encompass a wide range of travel services and support multiple currencies along with forex assistance.

Platform and Offerings

Their platform acts as a two-sided technology interface facilitating seamless transactions between suppliers (hotels, airlines, car rentals, etc.) and various types of buyers (travel agencies, tour operators, travel management companies, etc.). It supports an integrated, multi-currency, and multi-lingual system that allows for comprehensive discovery and booking capabilities across different travel segments such as leisure, corporate, and religious travel.

Revenue Models

Their business operates primarily on two revenue models:

  • B2B Rate Model: Where they receive inventory from suppliers, apply a markup, and then sell to buyers.
  • Commission Model: Where suppliers set their selling prices for the end travellers, and they earn a commission, part of which is retained and part shared with the buyer.

This overview showcases your platform’s role as a critical enabler in the travel industry, leveraging technology to bridge gaps between supply and demand while fostering global connectivity. This strategic positioning not only underscores their current success but also sets a solid foundation for future growth and expansion in the ever-evolving travel sector.

Objects of the TBO Tek Limited IPO:

The company intends to utilize the net proceeds from the issue towards the funding of the following objects: i. Expansion of the Supplier and Buyer base; ii. Amplification of value of our platform by adding new lines of businesses; iii. Inorganic growth through selective acquisitions and building synergies with our existing platform; and iv. Leveraging data procured to offer bespoke travel solutions to our Buyers and Suppliers.

TBO Tek Limited IPO Details:

Open Date: May 08 2024
Close Date: May 10 2024
Total Shares: 16,856,623
Face Value: ₹ 1 Per Equity Share
Issue Size: 1,550.81 Cr.
Lot Size: 16 Shares
Issue Price: ₹ 875 - 920 Per Equity Share
Listing At: NSE,BSE
Listing Date: May 15 2024

Promoters And Management:

Gaurav Bhatnagar is the Joint Managing Director of the Company. He holds a bachelor’s degree of technology in computer science and engineering from the Indian Institute of Technology, Delhi and worked at Microsoft Corporation. He is member of the executive committee of World Travel & Tourism Council (WTTC) and is one of the co-founders of TBO. He is also a cofounder of Tekriti Software Private Limited. He was appointed to their Board of Directors with effect from November 6, 2006 and has been associated with the Company since its inception. Ankush Nijhawan is the Joint Managing Director of the Company. He holds a bachelor’s degree of science in business administration, with a major in marketing and a minor in psychology from Bryant University. He has experience in the travel industry and is one of the co-founders of TBO. He is the chairperson for FICCI’s Outbound Tourism Committee. He is a member of Young President’s Organization. He has appeared on CNBC-TV18’s show titled ‘Young Turks’. He has been named amongst the “40 Most Influential Indians under 40 2016-17” by URS Asia One. He has also been facilitated by the Economic Times as “The Game Changers of India” for his “revolutionary and unconventional contribution to Indian industry”. He was appointed to our Board of Directors with effect from March 12, 2007. Udai Dhawan is a Non-Executive Nominee Director of the Company. He holds a bachelor’s degree in commerce from the Shri Ram College of Commerce, University of Delhi, a master’s degree in business administration from the Wharton School, University of Pennsylvania and is a Chartered Accountant from the Institute of Chartered Accountants of India. He has been involved in financial services since 1993. He is the founding partner at Affirma Capital. He was previously managing director for Standard Chartered Private Equity Advisory (India) Private Limited (SCPE). Prior to SCPE, Udai Dhawan worked in corporate investing, M&A and corporate finance, across India and the United States with J.P. Morgan, Sabre Inc., Kotak Mahindra Capital Company Limited and Arthur Andersen & Co. He was appointed to their Board of Directors with effect from September 7, 2018.

Financials of TBO Tek Limited IPO:

A. Balance Sheet
Particular (In Million) Mar-21 Mar-22 Mar-23 9MFY24
Equity Share Capital 18.95 104.24 104.24 104.24
Reserves 2,022 2,215 3,299 4,953
Borrowings 0 27 64 29
Trade Payables 1,732 7,273 18,030 27,221
Other Liabilities 1,989 3,095 4,083 5,232
Total Liabilities 3,721 10,396 22,176 32,483
Net Block 20 61 96 88
Capital work-in-progress 0.6 2 0 35
Investments 0.3 0.8 0.3 20
Other Assets 391 982 1,422 3,787
Total NC Assets 413 1,045 1,519 3,930
Receivables 1,202 5,311 15,662 26,087
Cash & Bank 3,324 5,043 6,613 5,454
Other Assets 823 1,316 1,786 2,069
Face value 1 1 1 1
B. Profit & Loss Statement
Particular (In Million) Mar-21 Mar-22 Mar-23 9MFY24
Sales 1,418 4,833 10,646 10,238
Service fees 360 1,585 3,319 3,526
Employee Cost 596 1,331 2,284 1,987
Other Expenses 689 1,596 3,223 2,798
Other Income 347 287 212 158
Depreciation 111 157 246 212
EBITDA 120 607 2,031 2,085
EBITDA Margin 8.50% 12.57% 19.08% 20.36%
Interest 12 35 72 65
Profit before tax -295 460 1,742 1,736
Tax 46 123 257 194
Net profit -341 337 1,485 1,542
NPM (%) -19.34% 6.59% 13.68% 14.83%
C. Cash Flow Statement
Particular (In Million) Mar-21 Mar-22 Mar-23 9MFY24
Cash From Operating Activity
Profit From Operation -119 481 2,044 2,006
Receivable 1,692 -3,966 -9,964 -2,935
Payable -915 5,357 10,076 1,885
Other WC Items -113 275 446 -321
Working Capital Changes 663 1,666 558 -1,371
Direct Taxes -39 -165 -228 -218
Net Cash Inflow from Operating Activity 506 1,983 2,374 418
Cash from Investing Activity
Fixed assets purchased -6 -59 -65 -67
Fixed assets sold 0.2 0.1 0.3 4
Other investing items -260 -247 -997 -1,205
Net cash inflow from investing activities -266 -306 -1,062 -1,267
Cash from Financing Activity
Repayment of borrowings 0 0 -3 -37
Intrest paid fin -12 -33 -66 -63
Other financing items -42 -124 -71 -17
Net Cash Flow 186 1,520 1,172 -967

Comparison With Peers:

Name of the Company Revenue (In Crore) PAT (In Crore) EPS ( in Rs) P/E CMP Mcap (In Crore)
TBO Tek Limited 1,065 148 13.67 67.3 920 9,990
Rategain Travel Technologies Limited 565 68 6.31 64.4 707 8,316
* All the data is as per FY23. * Note :- Travel CTM and Webjet Ltd are the global peers of this company.

Recommendation on TBO Tek Limited IPO:

Review and Recommendation of TBO Tek by team IZ is 7/10. 1. Their journey began during the mid-2000s when India experienced a surge in low-cost carriers, propelling the country to become the world's third-largest domestic aviation market. In 2006, they created the TBO platform as a technological solution for travel agents to simplify airline ticket booking across multiple airlines. The travel industry is vast, fragmented, and characterized by limited technology adoption. Guided by their mission to empower the travel industry through technology, they have grown into a global business, servicing buyers and suppliers in over 100 countries as of December 31, 2023. 2. Market Position They are a leading travel distribution platform in the global travel and tourism industry, recognized for their Gross Transaction Value (GTV) and revenue for Fiscal 2023. They operate in over 100 countries, offering buyers a comprehensive travel inventory tailored to their customers' needs. Their platform supports various currencies and offers foreign exchange assistance. They connect suppliers like hotels, airlines, and car rentals with buyers, including retail buyers such as travel agencies and independent travel advisors, and enterprise buyers like tour operators, travel management companies, and online travel companies. 3. Business Model Their two-sided technology platform facilitates seamless transactions between suppliers and buyers. The platform allows suppliers to display inventory, market their offerings, and set prices for a global buyer base. For buyers, their platform serves as an integrated, multi-currency, and multi-lingual solution for booking travel across various segments such as leisure, corporate, and religious travel. They employ two key revenue models: a B2B Rate Model, where they receive inventory from suppliers, apply a markup, and sell to buyers, and a Commission Model, where they earn a commission from suppliers based on sales. 4. Sales and Marketing As of December 31, 2023, their sales team comprises 449 members across 43 countries, playing a vital role in driving their business growth. Their sales and marketing focus is on increasing the number of buyers on their platform and enabling them to make more bookings. Their sales team focuses on onboarding new agents, conducting KYC procedures, and securing bank guarantees and credit from buyers where applicable. The team assists buyers in familiarizing themselves with the platform and achieving key milestones. 5. The Revenue has Increased from Rs.141 Crores in FY21 to Rs.1,064 Crores in FY23. 6. The EBITDA has Increased from 12 Crores in FY21 to 203 Crores in FY23. 7. The PAT has Increased from (-34) Crores in FY21 to 148 Crores in FY23. 8. As per FY23, CFO/EBITDA is 1.01, As per FY24, EPS is 18.93, 9. Market Capitalization is 9,990 Crore & P/E is 48.59x based on FY24.

Lead Manager of TBO Tek Limited IPO:

  1. Axis Capital Limited
  2. Jefferies India Private Limited

Registrar of TBO Tek Limited IPO:

  1. Kfin Technology Private Limited

Company Address:

TBO Tek Limited E - 78, South Extension Part I, New Delhi – 110 049 Phone: +91 124 499 8999 Email: corporatesecretarial@tbo.com Website: http://www.tbo.com/

Discussion on TBO Tek Limited IPO:


    1. TBO is a B2B player wherein it connects Airline and Hotel suppliers to travel agents.

    2. It charges ~7.25% on hotel booking and 2.59% on Flight booking. Overall Take rate is 4.77%. It means if INR 100 value booking done by Travel agent then INR 4.77 will go to TBO.

    3. The overall Travel buyers means consumers like us or companies, they book 5-10% Direct Online from Hotel or Airline company, 15-20% offline, 25-30% from OTAs like MakeMy Trip, Ease My Trip, Ixigo etc and 40-45% from Travel Advisors like TBO.

    4. The overall Travel Buyer market is ~3 Lakh cr in 2023 and it will go to 5 lakh cr in 2027.

    5. TBO revenue has increased from INR 176 Cr in Fy21 to 1000 Cr in Fy23. PAT has jumped from a loss of 29 cr to profit of 175 Cr.

    6. In the last 4 years, it has generated more than 500 cr in cash from operations.

    Looks like a great business with huge tailwinds in the travel sector.

      will u buy tomorrow ? at what price range ? seems lot of flippers nowadays in mainbaord ipos so operators also take advantage of that

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