TBO Tek IPO: Public Issue Subscribed 4.15X On Day 2

SUMMARY

The IPO received bids for 3.85 Cr shares as against 92.85 Lakh shares on offer at the end of second day

While the retail quota was subscribed 10.01X, NIIs bid for 2.06 Cr shares as against 25.23 Lakh shares on offer

TBO Tek plans to raise INR 1,551 Cr through its IPO, which comprises a fresh issue of shares worth INR 400 Cr and an OFS component of 1.25 Cr equity shares

B2B travel portal Travel Boutique Online or TBO Tek’s public issue was oversubscribed 4.15X on the second day on Thursday (May 9) on the back of strong interest from non-institutional and retail investors.

As per the BSE data, the initial public offering (IPO) received bids for 3.85 Cr shares as against 92.85 Lakh shares on offer.

Leading the pack were retail individual investors (RIIs), who placed bids for 1.68 Cr shares as against 16.82 Lakh shares on offer. As a result, the RII quota was subscribed 10.01X on Day 2.

On similar lines, the non-institutional investor (NII) portion was oversubscribed 8.19X as it received bids for 2.06 Cr shares versus 25.23 Lakh shares on offer. The portion reserved for employees saw TBO Tek’s workforce bidding for 2.13 Lakh shares as against 32,608 shares on offer.

Meanwhile, qualified institutional buyers (QIBs) remained on the sidelines on Day 2 as they bid for a mere 8.51 Lakh shares as against 50.47 Lakh shares on offer. This translates into a subscription rate of 0.17X.

The B2B travel portal’s public issue was subscribed 1.15X on the first day of its IPO on May 8.

The IPO will close on May 10, and shares of TBO Tek will list on the BSE as well as the NSE. The company received SEBI’s approval for the public issue in April this year.

Founded in 2006, TBO Tek provides travel solutions to travel agents and tour operators. It offers white-label solutions, hotel and flight booking APIs, and dynamic packages, among others.

The company plans to raise INR 1,551 Cr through its IPO, which comprises a fresh issue of shares worth INR 400 Cr and an offer for sale (OFS) component of 1.25 Cr equity shares.

While 75% of the IPO is reserved for QIBs, 15% has been earmarked for NIIs, and 10% for retail investors. The price band for the IPO is INR 875-INR 920 per equity share.

The company also raised INR 696.5 Cr from 47 anchor investors earlier this week at the upper spectrum of the price band.

It plans to use the proceeds from the IPO to accelerate growth, strengthen the platform and ramp up its tech stack. A portion of the capital will also be used to invest in its new arm, Tek Travels DMCC, onboard new users via marketing and promotional activities, and hiring. The funds from the IPO will also be utilised for unidentified inorganic acquisitions and towards general corporate purposes.

Meanwhile, brokerage Motilal Oswal Financial Services has given a thumbs up to the public issue and recommended investors to subscribe to the IPO.

“TBO Tek is well positioned to capitalise on industry tailwinds and gain market share through business diversification and strategic acquisition. We recommend subscribing to the IPO. Investors could see listing gains as well due to the market fancy for such high-growth niche business,” the brokerage recently said.