Online Travel Platform TBO Tek Files IPO Papers, Plans to Raise Rs 400 Crore

TBO Tek, the online travel distribution platform, has taken a significant step towards going public by filing draft papers with the capital markets regulator, the Securities and Exchange Board of India (SEBI). According to the Draft Red Herring Prospectus (DRHP) filed on November 8, the IPO consists of a fresh issuance of shares worth Rs 400 crore by the company, in addition to an offer-for-sale (OFS) of 1.56 crore equity shares by promoters and investors.

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The selling shareholders in the OFS include promoters Gaurav Bhatnagar, Manish Dhingra, and LAP Travel, as well as investors TBO Korea and Augusta TBO. The Gurugram-based B2B travel service provider is also considering raising Rs 80 crore through private placement (pre-IPO placement) before filing the final Red Herring Prospectus with the Registrar of Companies (RoC). This private placement, if undertaken, would reduce the size of the fresh issue accordingly.

TBO Tek had previously filed IPO papers in December 2021, seeking to raise Rs 2,100 crore, and had received approval from the regulator in May 2022. However, it deferred the IPO launch due to challenging market conditions and geopolitical tensions.

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Of the net fresh issue proceeds, TBO intends to allocate Rs 260 crore towards its growth and platform enhancement by adding new buyers and suppliers. Additionally, Rs 40 crore will be used for inorganic acquisitions and general corporate purposes.

The travel distribution platform, co-founded by Gaurav Bhatnagar and Ankush Nijhawan, has demonstrated robust growth in its bookings, with 41,218 bookings per day for the fiscal year ending in March 2023, marking a 46 percent increase from the previous year. The gross transaction value for FY23 reached Rs 22,323.56 crore, a significant jump from Rs 10,256.5 crore in FY22. In the first quarter of FY24, the platform recorded 47,921 bookings per day with a gross transaction value of Rs 6,947.7 crore.

In terms of financial performance, TBO Tek reported a net profit of Rs 148.5 crore for FY23, more than quadrupling the previous year’s figure of Rs 33.7 crore. Revenue from operations during the same period more than doubled, reaching Rs 1,064.6 crore from Rs 483.3 crore. In the first quarter of FY24, the company posted a net profit of Rs 47.3 crore on revenue of Rs 344.56 crore.

Promoters, including Gaurav Bhatnagar, Manish Dhingra, and LAP Travel, collectively hold 51.26 percent of the company’s shares, while among investors, Augusta TBO is the largest shareholder with a 24.32 percent stake, followed by TBO Korea at 13.77 percent, and General Atlantic at 7.5 percent.

TBO Tek, established in 2006, is often compared to Rategain Travel Technologies, a domestic listed entity, and competes globally with Travel CTM and Webjet. Axis Capital, Goldman Sachs (India), JM Financial, and Jefferies India are the book-running lead managers for the IPO, with KFin Technologies serving as the registrar to the offer.

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