TBO Tek Jumps Over 9% After Jefferies Raises Price Target

Shares of travel tech major TBO Tek surged 9.4% to an intraday high of INR 1,687 today after brokerage firm Jefferies raised its price target for the company.

At 13:40, the stock was trading 5.3% higher at INR 1,624.25 on the BSE. Its market capitalisation stood at INR 17,622.17 Cr (about $2 Bn). Nearly 10 Lakh shares were traded by then.

Jefferies maintained its ‘Buy’ rating on the company and raised the target price to INR 1,800, up 17% from INR 1,625 earlier. The brokerage firm gave an upside scenario of INR 2,100 and a downside scenario of INR 1,400.

It highlighted TBO’s recent $125 Mn acquisition of Classic Vacations, a US-based premium luxury travel company. The deal will strengthen TBO Tek’s presence in the US outbound travel market, which previously contributed only about 5% of its gross transaction value.

“The acquisition will allow TBO to tap into Classic’s consortia relationships in the US market. TBO plans to gradually integrate Classic’s ~1,500 hotels into TBO Platinum, its luxury hotel curation platform. Classic also operates with meaningful negative working capital and has a much longer average booking window of ~140–245 days versus 60 days for TBO,” the brokerage said.

Analysing the take rates of TBO Tek and Classic Vacations (CV), Jefferies said, “Classic has a significantly higher gross take rate of ~22–23% (vs ~6% for TBO), about half of which goes back as commission to travel advisors. Unlike TBO, Classic has a lower share of low-take rate air business. Reported EBITDA margins are lower for CV at ~10% (because of inflated revenues) vs ~17% for TBO.”

The brokerage expects TBO’s gross transaction value (GTV) to grow at a CAGR of 20% over FY25-FY28, with revenue expanding 33% and EBITDA/PAT growing at 36% CAGR.

TBO Tek, which connects travel suppliers like airlines and hotels with buyers such as travel agencies and OTAs, is steadily shifting focus toward the more profitable hotels segment while expanding its international footprint, particularly in the US.

The company has been on an expansion spree for some time now, setting up subsidiaries in countries like Poland, Canary Island, Indonesia, Greece, Australia, among others.

On the financial front, its net profit rose over 3% year-on-year (YoY) and 7% quarter-on-quarter (QoQ) to INR 63 Cr in Q1 FY26. Operating revenue surged 22% YoY and 15% QoQ to INR 511.3 Cr during the quarter.

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