TBO Tek IPO: Here are 10 key risks from the RHP you should know

TBO Tek IPO opened for subscription on 8 May, 2024 and the issue is likely to close on 10 May 2024. The price band for TBO Tek IPO that comprises of an offer-for-sale (OFS) by the promoters and other investors, as well as a fresh issuance, had been set at 875 to 920 per equity share of face value of Re 1. 

Here are 10 key risks from the RHP you should know before subscribing

1. TBO Tek IPO revenue is substantially dependent on the hotels and ancillary bookings whose contribution has significantly increased from 35.69% of its revenue from operations for Fiscal 2021 to 67.83% for Fiscal 2023 and was 67.59% and 72.47%, respectively, for the nine months ended December 31, 2022 and December 31, 2023.

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 In addition, all of its Gross transaction Value (GTV) is entirely dependent on our air and hotels and ancillary bookings in the last three Fiscals and in the nine months ended December 31, 2022 and December 31, 2023, respectively. Factors that may negatively impact its hotels and ancillary bookings could have an adverse effect on our business, prospects, results of operations and financial condition

2. TBO Tek business depends on its relationships with a limited range of Suppliers, and any adverse changes in such relationships, or its inability to enter into new relationships, could adversely affect its business and results of operations.

3.  TBO Tek business is exposed to pricing pressure from its Suppliers who may withhold inventory or modify the terms of our arrangements, including for a reduction or elimination of commission, incentive or other compensation payable to it, which could adversely affect its business and results of operations.

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4. TBO Tek has certain contingent liabilities that have not been provided for in its financial statements, which if they materialize, may adversely affect its financial condition.

5. TBO Tek depend on its proprietary technology for critical functions of its business. Failure to properly maintain or promptly upgrade its technology may result in disruptions to or lower quality of its services and its business, results of operations and financial condition may be adversely affected.

6. TBO Tek and its Joint Managing Directors, namely Ankush Nijhawan and Gaurav Bhatnagar, have received a show cause notice from the Enforcement Directorate and compounding applications are in the process of being filed with the Reserve Bank of India. Consequently, TBO Tek may be subject to regulatory actions and penalties/compounding fees for such non-compliance which may adversely impact TBO Tek business, financial condition and reputation.

7. TBO Tek operates in a highly competitive industry and its inability to compete effectively may adversely affect its business and results of operations

Also Read- TBO Tek IPO Day 2: Should you subscribe or not? Check GMP, key dates, review, subscription status, more.

8. TBO Tek do not have any exact comparable listed peers in India or abroad. Accordingly, valuation of the Company as compared with other listed Indian platforms operating in the travel industry, global companies operating in travel industry and other online platforms listed in India, may not be comparable and could be higher on account of certain aspects.

9. Failures of the third-party data center hosting facilities could impair the delivery of TBO Tek services and solutions and adversely affect our business.

10. TBO Tek Offer price of  is at a premium to the price at which its existing shareholders, namely Augusta TBO and TBO Korea, have sold Equity Shares to General Atlantic in October 2023 and February 2024.





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Published: 09 May 2024, 05:29 PM IST

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