Whalesbook
Anand Rathi Reaffirms 'Buy' on TBO Tek, Raises Target to ₹2,000
Anand Rathi's research report, issued January 16, 2026, recommends a "Buy" on TBO Tek, significantly elevating its target price to ₹2,000 from ₹1,725.
Growth Catalysts Identified
Anand Rathi highlighted several key factors positioning TBO Tek for sustained expansion in the global travel distribution sector. The recent acquisition of Classic Vacations, integrated in October 2025, is expected to significantly bolster the company's capabilities.
Growth in the hotel segment is showing strong momentum, with Gross Transaction Value (GTV) rising approximately 16.6% year-over-year in the first half of fiscal year 2026. This outpaces the overall GTV growth of around 7.2% year-over-year during the same period.
International market presence has been strategically expanded, with TBO Tek adding 23 new countries over the past 18 months, signaling a robust global push.
Stabilizing Domestic Operations and New Agent Traction
Signs of stabilization are emerging in the domestic Indian business, with expectations for high-single-to-early-double-digit year-over-year growth commencing in the third quarter of fiscal year 2026, a notable turnaround from a flat-to-declining trajectory observed over the preceding three to five quarters.
The contribution from new travel agents is also increasing, accounting for approximately 6.9% of GTV in the first half of fiscal year 2026, up from 4.3% in the first half of fiscal year 2025.
Financial Outlook and Margin Expansion
Analysts foresee an expansion in EBITDA margins starting from the fourth quarter of fiscal year 2026. This is attributed to the tapering of investments in key account managers and the onset of operating leverage, coupled with a year-over-year slowdown in Selling, General, and Administrative (SG&A) growth.
Valuation Rationale
Incorporating the projected contribution from Classic Vacations from the second half of fiscal year 2026, which is expected to add approximately 10% to consolidated GTV, Anand Rathi retains its "Buy" rating. The target price has been revised upward to ₹2,000 from ₹1,725.
The stock is valued at approximately 41 times estimated earnings per share for fiscal year 2028, a slight adjustment from the previous valuation metric based on September 2027 earnings. This premium multiple is justified by TBO Tek's strategic focus on the high-margin premium travel sector, its asset-light business model, and a negative working capital cycle.