India’s TBO Gets Green Light for IPO

Travel distribution platform TBO Tek has received the final nod from the Securities Exchange Board of India (SEBI) to raise funds through an IPO.

The issue includes fresh equity of INR 4 billion ($48 million) and an offer for sale of up to 15.6 million shares by its promoters and investors. The company had filed a draft prospectus last November.

TBO had filed draft papers with SEBI in December 2021 – but the IPO didn’t happen.

“Our objective is to aggregate world’s offline travel demand into a single place and offer it as a distribution channel to the global travel supply. Our focus is outbound travel as that’s where the friction exists,” co-founder and joint managing director of TBO, Gaurav Bhatnagar, said while discussing the brand at the Skift India Summit.

TBO Tek has global presence and serviced buyers and suppliers in more than 100 countries.

“We do believe that there is value for us as a company in terms of where we are in our journey to hit the public markets,” Bhatnagar said at the Skift India Summit.

Around 70% of the revenue for the company comes from hotels, TBO co-founder and joint managing director, Ankush Nijhawan, had said.

How TBO Plans to Use the Funds

TBO had earlier mentioned that the proceeds of the IPO would be used for growth and strengthening of the platform by onboarding new buyers and suppliers. The company would also use significant amount of funds to support its India growth plans as well as for general corporate purposes.

“We have historically invested and continue to invest in marketing endeavors primarily focused on increasing the number of buyers on our platform and empowering them to do additional bookings on our platform,” TBO said in the draft papers.

TBO had 5,005 suppliers at the end of fiscal 2023, more than doubling in two years. The monthly transacting buyers on its platform rose from 10,401 in fiscal 2021 to 24,530 in fiscal 2023.

“To expand geographically in large markets like North America, Europe, and Asia Pacific (APAC), we would require significant expenses for entering into a new market across various aspects including brand building, brand and product awareness, leadership hiring and other related marketing and promotion activities,” said the DRHP.

Online travel company Ixigo restarted the IPO filing process in February after it shelved its earlier listing plans citing unfavorable macroeconomic conditions. Reports earlier this year had also cited that Oyo would be withdrawing its IPO, which the company later denied.

TBO Acquisitions

Last year in December, TBO had acquired Jumbonline, a Spain-headquartered distribution platform for wholesalers and tour operators.

Earlier, the company had fully acquired BookaBed, a business-to-business (B2B) accommodation wholesaler for an undisclosed amount. The company said the acquisition deepened TBO’s footprint in Ireland and the UK.

Global investor firm General Atlantic had acquired a minority stake in TBO from Affirma Capital last year in October. In 2018, Affirma Capital had invested around $42 million to acquire a 46% stake in TBO Tek. Affirma had divested around 7% stake in the company through the deal with General Atlantic.

“We see immense potential in the path ahead for TBO, including global expansion opportunities, and are excited to partner with the company to help enable the next generation of travel globally,” Shantanu Rastogi, managing director and head of India at General Atlantic, had said then.