WebBeds - A Potential Event-driven Opportunity
The fast-growing Australian competitor of HBX Group (HotelBeds)
Disclaimer: This publication is for educational purposes only and should not be taken or considered as investment advice under any circumstances. Please consult with your financial advisor before making any investment decisions.
Following the publication of our Initial Equity Research on HBX Group (HotelBeds), we believe it is an excellent moment to revisit Web Travel Group / Webbeds ( WEB. AX, A$1.34Bn) , one of its closest global comparable and a company we have analysed in the past.
The stock has fallen sharply this week after issues related to the auditor of its Spanish subsidiary surfaced, adding a new layer of uncertainty to a name that has already experienced periods of volatility since its de-merger. We are therefore using this dislocation to reassess the business, its underlying economics and its current valuation, to determine whether the market reaction may be creating a short-term opportunity — or whether, as was the case 15 months ago, caution remains the right approach.
WebBeds is the B2B accommodation distribution arm that emerged from the separation of the B2B and B2C operations of Webjet Limited. The rationale was to allow investors to value the faster-growing, more scalable wholesale platform on a standalone basis. Today, the company is listed in Australia and operates globally as a hotel bed bank, connecting hotel inventory with travel agencies, tour operators, airlines and other intermediaries. Since its creation in 2012, growth has been driven both organically and through acquisitions such as JacTravel and DOTW, which helped build a broad geographic footprint and contracting scale.
From an industry perspective, WebBeds occupies the same structural niche as HotelBeds: a technology-enabled, asset-light intermediary positioned between hotels and downstream distributors. However, their development paths have differed. HotelBeds historically built its scale with a strong focus on operational discipline and margin optimisation, while WebBeds has pursued a more expansionary, acquisition-led strategy, which accelerated growth but also introduced greater complexity and, at times, more volatility in earnings and visibility. This makes WebBeds an especially relevant comparable for HotelBeds - but also a business where execution and financial consistency are more closely scrutinised by the market, particularly in moments like the current one.
Today, we publish our analysis on Webbeds to assess the potential opportunity that the market is offering
Clear breakdown of the business model and how the bed bank platform works
Direct comparison with HBX Group and the key structural differences between the two
An analysis of the recent take-rate reset and margin dynamics
A deep dive into the financials, operating leverage and cash conversion
The capital structure, including the April-26 convertible and liquidity position
The main value drivers and key execution risks
Our valuation following a DCF method
Our independent view on the situation