BLS International

I started studying BLS for potential investment. I have a few questions. Would be great if forum members that have studied/invested could provide some insights.

1. In Q2 FY25 concall, management mentioned – “Furthermore, our net revenue per application has also increased from INR1,988 in Q2 FY ’24 to INR2,883 in Q2 FY ’25”. Would anyone know what are the contributing factors to this? Close to 50% increase is phenomenal, but going through the con call/investor I could not understand what is contributing to this. Management mentioned transition from partner model is primary reason for EBIDTA improvement, that would be on costs side rather than revenue side. also, 50% increase within just one year seems very high.

2. In essence, this business is a BPO/KPO business in a niche area with reasonably high barriers to entry. Is my assessment right?

3. On the balance sheet for Sep 24 there is a goodwill of ~700 Cr. Is that due to acquisition of iData?

4. Does BLS get paid in foreign currency? Do we know if the currency fluctuation impacts their topline and bottom line significantly? Are they hedged?

5. If the visa processing and related business is high margin and big TAM, why get in to E Services business with lower margins at all? Why would the company diversify into a business which is inferior by nature of high competition and lower margins?

6. While going through this thread there were mentions that company will need to pay taxes if they bring in cash parked in Dubai. In the Q2 concall management mentioned most of the cash is in India. When did this movement to India happen? Or did they just use the money abroad for acquisition and therefore India cash balance went up?

7. In Q2 concall, management was all gung ho about future prospects. How is the experience with this management in terms of outcomes being inline with what they project? I generally like managements that don’t overpromise.

8. Till when is their Spain contract in force? contributing 25-30% that seems to be the major topline contributor.

Disc – no investment at present. Studying for potential investment.