TBO TEK shares surge 29% so far this month; Here is what Jefferies said on its latest acquisition of Classic Vacations

Shares of TBO TEK, the country's leading travel distribution platform, rose for a third straight session on Tuesday, September 9. In the last three trading session, the stock has advanced 11% and since the start of the month, TBO TEK shares have surged 29%, data from BSE showed.

TBO TEK shares, in intraday deals on Tuesday, rose as much as 7.48% to hit high of ₹1,688.

Shares of TBO TEK came under buying interest after the company last week informed exchanges that it signed an agreement to acquire US based Classic Vacations from Phoenix-based investment firm, The Najafi Companies, for an estimated total purchase of up to $125 million.

Following its acquisition announcement, global investment firm Jefferies said that it is the company's first material acquisition after Jumboline in Europe in 2023 and in line with roll up strategy of incubating new source markets.

Jefferies added that the deal strengthens TBO TEK's presence in premium outbound market, especially in North America from where it currently contributes 5% towards its total GTV.

The company last week announced that its wholly owned step-down unit TBO LLC has approved the acquisition of 100% ownership interest of Classic Vacations LLC from Phoenix-based investment company, The Najafi Companies, for a consideration of up to $125 million.

The company said that its expansion into serving the premium outbound travel market positions strategically with Classic Vacation’s exclusive business-to-business brand and elite, high-value advisor network.

Ankush Nijhawan, co-founder and joint managing director of TBO, said that the acquisition continues to further the company's strategy to invest in both organic and inorganic growth opportunities.

"As we start working on integrating Classic Vacations with TBO, we will remain open to similar strategic alliances going forward," he said.

"We’re thrilled to bring Classic Vacations into the TBO family – the company’s longstanding delivery of outstanding services has earned the trust of its more than 10,000 travel advisors in the U.S. and their end customers, making them a seamless fit for our vision moving forward in the fast-evolving travel and tourism industry," said Gaurav Bhatnagar, TBO’s cofounder and Jt. Managing Director.

Classic Vacations had posted a revenue of $111 million and an operating EBITDA of $11.2 million in the financial year ended December 31, 2024.

TBO TEK in the first quarter of current financial year reported a 22.17% year-on-year (YoY) increase in consolidated revenue from operations to ₹511.27 crore and 3.36% YoY surge in net profit to ₹62.96 crore.

As of 2:49 pm, TBO TEK shares traded 6.29% higher at ₹1,669, outperforming the BSE 500 index which was up 0.26%.