TBO Tek IPO: Issue Subscribed 2x On Day 2, Retail Investors Lead; GMP Hints Premium Listing

TBO Tek's much-anticipated initial public offering (IPO) has garnered a strong response from investors, with the subscription reaching 2.05 times the offered shares on the second day of bidding.

Investors have offered bids for 1.9 crore equity shares, surpassing the 92.85 lakh shares on offer. Retail investors emerged as the most active participants, displaying nearly six times their allotted quota, followed closely by non-institutional investors, who secured 3.5 times the reserved portion.

However, Qualified Institutional Buyers (QIBs) have yet to fully engage, exhibiting only a modest 1% interest in the portion allocated for them.

TBO Tek, a player in the global travel and tourism sector, has exhibited robust financial performance in FY23, boasting a substantial Gross Transaction Value (GTV) and revenue from operations.

The company witnessed healthy financial growth, with profits surging by 340% year-on-year to Rs 148.5 crore, while revenue from operations soared by 120.3% to Rs 1,064.6 crore.

The IPO price band has been set at Rs 875 to Rs 920 per share, indicating a positive outlook for potential investors. TBO Tek successfully raised Rs 696.51 crore through an anchor book launched on May 7. The company allocated a total of 75,70,807 equity shares to anchor investors at a price of Rs 920 per share.

Global investors, including prestigious entities such as Abu Dhabi Investment Authority, Government Pension Fund Global, Neuberger Berman Investment Funds, Nomura Funds, Blackrock Global Funds, Fidelity Funds, Goldman Sachs, HSBC Global, and Eastspring Investments, participated in the anchor book offering.

The overwhelming response to TBO Tek's IPO underscores investor confidence in the company's business model and growth trajectory, particularly in the wake of the revival of the travel and tourism industry following the disruptions caused by the COVID-19 pandemic.

The IPO, offering a mix of fresh shares and an Offer For Sale (OFS), aims to raise a total of Rs 1,550.81 crore, with Rs 400 crore earmarked for fresh shares and the remainder through OFS.

Scheduled for listing on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), TBO Tek's IPO promises wider accessibility to investors across the spectrum. Even before its official market debut, TBO Tek shares are quoting a premium of Rs 529 in the grey market, indicative of the fervent investor interest surrounding the IPO.

The Red Herring Prospectus of TBO Tek IPO reveals that the company's promoters currently hold a 51.26% stake, with public shareholders accounting for 46.43% of the stake. Notable among the public shareholders is Augusta TBO, holding a 19.53% stake, followed by General Atlantic with 15% and TBO Korea with 11.06%. Together, promoters and public shareholders command 98.54% of the company, leaving a 2.31% stake with the TBO ESOP Trust.

The IPO launch marks a significant milestone for TBO Tek, signalling its entry into the Indian market with the backing of key investors like General Atlantic. With its innovative approach to online travel distribution and a solid industry foothold, TBO Tek is poised to capitalize on the opportunities in the Indian market.

The public issue, offering each lot comprising 16 shares, allows investors flexibility in their bidding strategies. KFin Technologies has been appointed as the registrar for the book build issue, ensuring a seamless process for all stakeholders involved.

The allotment of shares is slated for finalization on May 13, 2024, paving the way for investors to secure their stakes in this tech venture. Excitement mounts as TBO Tek prepares for its proposed listing on both BSE and NSE, with the anticipated listing date set for May 15, 2024, in accordance with the 'T+3 listing rule'.