TBO Tek Limited has released the transcript of its Earnings Conference Call held on February 11, 2026, concerning the Q3 and 9M FY26 financial results. The discussion heavily focused on the accounting complexities and early integration progress of the recently acquired Classic Vacations (CV) business. Management provided clarity on revenue recognition methods, take rates, and future platform migration strategies, emphasizing that Gross Profit conversion remains the key metric for value assessment.
Q3 FY26 Earnings Call Highlights: Classic Vacations Integration
TBO Tek Limited officially submitted the transcript of its Earnings Conference Call, which took place on Wednesday, February 11, 2026, following the release of its Unaudited Standalone and Consolidated Financial Results for the quarter ending December 31, 2025. The management team, including Co-Founders Mr. Ankush Nijhawan and Mr. Gaurav Bhatnagar, addressed key concerns regarding the consolidation of Classic Vacations (CV).
Accounting Policy Divergence and Metrics
CFO Mr. Vikas Jain detailed the primary accounting difference: CV recognizes hotel and ancillary revenue on a check-in basis, unlike TBO’s booking-based recognition. This leads to noise in blended metrics. For the quarter, consolidated revenue from operations stood at Rs. 784 Cr. The organic business delivered a take rate of 6.04%, while CV reported a headline take rate of 24.94% (including a 12.4% commission passed to advisors). Due to these differences, management stressed that Gross Profit (GP) as a percentage of GTV is a more robust measure of value capture.
Enterprise GTV to Adjusted EBITDA conversion improved to 1.18% in Q3 FY26 from 1.05% in Q3 FY25. CV contributed a 2.46% GTV to adjusted EBITDA conversion for the quarter.
Cross-Sell Progress and Future Synergy Outlook
Management noted that early cross-sell signs are promising. TBO selling inventory into CV has already commenced. Furthermore, CV buying from TBO is becoming meaningfully large, positioning it among TBO’s top 20 customers if viewed standalone. The larger platform migration is a complex project expected to take two or three quarters before material benefits materialize.
Regarding operating leverage, the company expects the organic business to demonstrate significant margin expansion in Q4, with SG&A growth tapering down relative to top-line growth.
Take Rates and Forex Impact
On the organic business, management affirmed conviction in maintaining strong take rates, despite a slight dip in the net take rate for the airline segment to 1.1% (GP basis), compared to 1.2% year-over-year. Management stated they aim to keep the airline GP stable around 1.1% to 1.2%.
Regarding Forex impact, the cost line item includes hedging costs and MTM impacts. While the revaluation of the loan provided to TBO Dubai resulted in some gains this quarter, the overall Forex impact has reduced materially year-on-year.
Classic Vacations: Structure and Growth
The acquisition grants TBO access to approximately 10,000 active luxury travel advisors in North America through consortium relationships like Virtuoso and Signature. Management expects the overall North America business (TBO organic plus Classic) to achieve high double-digit growth over the next three to four years.
In terms of working capital, CV is inherently a highly negative working capital business due to the long window between booking and travel. This is expected to contribute further to negative working capital at the enterprise level.
Source: BSE
