TBO Tek IPO Subscribed 1.15X On Day 1; Motilal Oswal Recommends Subscription

The initial public offering (IPO) of B2B travel portal Travel Boutique Online or TBO Tek was subscribed 1.15X  on the first day of bidding on Wednesday (May 8). 

According to BSE data, the public issue received bids for 1.06 Cr as against 92.85 Lakh shares on offer. Subscriptions for the IPO will close on May 10.

The IPO saw the greatest interest from retail investors, who placed bids for 52.75 Lakh shares as against the 16.82 Lakh shares reserved for them, resulting in a 3.14X subscription.

Non-institutional investors’ (NIIs) quota was oversubscribed 2.08X, with the investors placing bids for 52.59 Lakh shares against 25.23 Lakh shares reserved for them. However, the qualified institutional buyers (QIBs) portion saw a 0.01X subscription, as QIBs only bid for 58,464 shares against the 50.47 Lakh shares reserved for them.

On the other hand, shares reserved for employees were subscribed 2.2X, with employees bidding for 72,608 shares against the 32,608 reserved for them. 

About 75% of the IPO is reserved for qualified institutional buyers (QIBs), 15% for NIIs, and 10% for retail investors. Investors can place bids for a minimum of 16 equity shares and in multiples of that thereafter. 

The public offer comprises a fresh issue of shares of up to INR 400 Cr and an offer for sale (OFS) component of 1.25 Cr equity shares. It has set a price band of INR 875-INR 920 per equity share. 

At the upper end of the price band, TBO Tek is expected to raise INR 1,551 Cr from the IPO.

Ahead of its public issue, the B2B travel portal notified the market regulator that it raised INR 696.5 Cr from 47 anchor investors. “The IPO committee of the Board of Directors… has finalised allocation of 7,570,807 equity shares to anchor investors at the anchor investor allocation price of INR 920 per equity share (including share premium of INR 919 per Equity Share)…,” it said in a BSE filing. 

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.  

Meanwhile, brokerage Motilal Oswal Financial Services has 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 said. 

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