TBO Tek reported a 37.4% year-on-year increase in Gross Transaction Value to ₹111.5 billion for Q1 FY27. Following the strong results, Anand Rathi has maintained a positive outlook on the stock and raised its price target. Investors are now focusing on the company's ability to maintain margins amidst regional geopolitical pressures.
TBO Tek has posted a strong start to the 2027 fiscal year, with key financial metrics showing significant year-on-year growth. The travel distribution platform reported its Gross Transaction Value (GTV) at ₹111.5 billion, representing a 37.4% increase compared to the same period last year. A major driver for this performance was the Hotels & Ancillaries segment, which recorded a 49.8% surge in GTV, while the Airlines segment contributed a 16.9% increase.
Segment Performance and Take Rate Dynamics
The company's total take rate—the percentage of GTV that the company keeps as revenue—improved to approximately 8.3% in the first quarter, up from 6.3% in the same quarter last year. This increase was largely supported by the Classic Vacations segment, which reached its highest-ever quarterly performance. However, there were some offsetting factors within the organic business. The organic take rate saw a marginal decline to 6%, influenced by lower airline and hotel take rates. These specific pressures are being attributed to ongoing geopolitical conflicts in the Middle East, which have impacted travel dynamics in that region.
Despite the pressure on specific take rates, the company's operating efficiency improved significantly. EBITDA (earnings before interest, taxes, depreciation, and amortization) grew by 84.23% year-on-year to reach ₹1.4 billion. This result beat analyst expectations by a notable margin, with the EBITDA margin expanding to 15.5% compared to 15.2% in the previous year. Organic margins also strengthened, rising to 16.8% from 15.2%.
Future Outlook and Brokerage View
Following these results, Anand Rathi has updated its outlook, raising its EBITDA estimates for FY27 and FY28 by 10.2% and 16.4%, respectively. The brokerage has maintained a positive rating on the stock and increased its price target to ₹2,200, based on a valuation of approximately 40 times the estimated FY28 earnings. The firm expects a recovery in the second half of the fiscal year, driven by a potential rise in pent-up travel demand in the Middle East and better management of operational costs.
For investors, the key area to monitor will be how effectively TBO Tek navigates the impact of Middle Eastern conflicts on its take rates in the coming quarters. The company’s ability to scale its gross profit while moderating growth in selling and administrative expenses will be a critical factor in sustaining the current margin expansion trend.