BLS - BLS International Services Ltd Share Price

In the earnings call held on May 16, 2025, management provided an optimistic outlook for BLS International Services Limited, highlighting strong financial results and strategic growth plans. For FY '25, the company's consolidated revenue reached INR 2,193 crores, marking a 31% year-on-year growth. EBITDA rose to INR 629 crores with a margin of 28.7%, and net profit increased 66% to INR 540 crores.

Key forward-looking points include:

1. Visa Volumes: Management reported a record 37.51 lakh visa applications for FY '25, up from 28.65 lakh in FY '24. The target for FY '26 is to sustain a healthy growth rate of 15% to 20% annually.

2. EBITDA Margin Sustainability: Management asserted that the EBITDA margin level of over 30% is sustainable, citing ongoing efforts to improve operational efficiency through transitioning to a self-managed model.

3. Digital Business Growth: The digital services segment generated revenue of INR 540 crores, reflecting a 71% increase, driven by strong integration of acquisitions. The digital ecosystem now has over 44,800 CSPs and 142,000 touchpoints.

4. Cash Position: The company maintained a robust cash balance of INR 928 crores after investing over INR 1,000 crores in strategic acquisitions, highlighting continuous cash generation from operations.

5. Future Tenders: Management emphasized that there is a significant pipeline of contracts ($1 billion worth) up for renewal, and they are keen to capitalize on emerging opportunities, positioning the company for sustained growth.

Overall, management's focus on organic growth, strategic acquisitions, and maintaining operational excellence indicates a positive outlook for future performance.

1. Question: "How many visa permissions do we have applied for and what is our success ratio?"

   Answer: We processed around 9.8 lakh applications this quarter, a 38% increase year-on-year. Currently, we have not had any sanctions on tenders we applied for, but we are actively pursuing multiple international tenders. Our growth has largely come from organic wins and ongoing contract deployments.

2. Question: "What is the target for the financial year '26 regarding visa fees?"

   Answer: We aim to maintain our current numbers and strive for a healthy growth of 15-20%. While we set internal targets, we prefer not to provide specific public forecasts at this time.

3. Question: "Is the improvement of more than 10% in EBITDA margin sustainable in the Visa & Consular segment?"

   Answer: Yes, we believe this level is sustainable due to our operational improvements, transitioning from a partner-led model to self-managed operations, which has led to increased service fees and enhanced conversion rates.

4. Question: "What accounts for the significant increase in 'other costs' contributing to 47% of total costs?"

   Answer: The increase is due to our shift to a self-managed model, leading to higher fixed costs like employee salaries and office rent. Previously, we paid partners commissions, but now these operations incur direct operational costs which have increased in the 'other' category.

5. Question: "Can you elaborate on the competitive landscape for future acquisitions, particularly in light of our EBITDA profiles?"

   Answer: While competition exists, we still see potential opportunities for acquisitions with strong EBITDA profiles. The visa business remains robust at around 34% margin, and we continue to explore high-quality targets strategically aligned with our growth trajectory.

6. Question: "What are our plans for utilizing the cash balance of around INR 900 crores?"

   Answer: We plan to continue making strategic acquisitions, paying dividends, reinvesting in technology and infrastructure, and possibly hiring quality talent to foster growth. Our cash-generating model allows us flexibility in pursuing these avenues.

7. Question: "With regards to post-COVID volumes in China, are they back to pre-COVID levels?"

   Answer: Yes, volumes from China are nearly back to pre-COVID levels, and we have fully transitioned to our operational model there. This has contributed positively to our revenue growth in that region.

8. Question: "What is the future outlook for BLS E-Services, and do you plan to expand beyond India?"

   Answer: We see excellent growth potential in BLS E-Services, having expanded our network significantly and incorporated new revenue streams. While our immediate focus is on India, we remain open to exploring opportunities in neighboring markets in the future.

9. Question: "Can you provide commentary on the medium-to-long-term growth prospects over the next 3"“5 years?"

   Answer: We expect to maintain a growth momentum of around 15-20% in revenue. While we emphasize a conservative approach to forecasting, increased trust from governments and our ability to win tenders positions us well for sustained organic growth.

10. Question: "Can you elaborate on the contributions from the iDATA and Aadifidelis acquisitions to our financials?"

Answer: The acquisitions contributed around 20% to the 82% growth in EBITDA this year, but we are still capturing their full potential in our results. Exact revenue figures are still being assessed as we integrate these entities into our operations.