In an assertive vote of confidence, Nuvama Wealth has initiated coverage on BLS International Services (BLSIN) with a ‘BUY’ rating and a target price of INR 637, implying a significant 55.74% upside over the current market price of INR 409 per share. The brokerage underscores BLS’s strong fundamentals, astute acquisitions, high-margin self-managed model, and deep penetration in mission-critical public services as drivers of long-term value.
Backed by a stellar Q4FY25 performance, aggressive digitisation, and a well-capitalised balance sheet, BLS is emerging as a rare mid-cap services play that blends capital efficiency, predictable annuity-like revenue, and tech-led scalability.
From Visa Outsourcer to Government Tech Partner
Founded in 2005, BLS International began as a visa services facilitator and now sits firmly entrenched in the global USD 2.6 billion (~INR 22,221 crore) visa outsourcing industry—a sector historically known for high entry barriers, strict compliance, and sticky government contracts.
BLS International has carved out a formidable presence with 46 government clients across 70 countries, having processed over 360 million visa applications globally. Today, it operates across two synergistic verticals:
- Visa and Consular Services (75% of revenue)
- Digital Services (25% of revenue)
The company’s pivot into e-governance and digital citizen services is timely, riding on structural themes of government outsourcing, rural digital inclusion, and financial services penetration in underbanked geographies.
BLSIN Q4FY25: Record Revenue, Margin Expansion, and Execution Prowess
BLS Q4 FY25 results mark an inflection point in its trajectory. Revenue from operations rose 55% YoY to INR 693 crore, beating Nuvama’s estimate by 7%, led by a 226% jump in digital services and a 19% growth in visa and consular operations.
BLS International Q4 Highlights:
| Metric | Q4FY24 | Q4FY25 | YoY Growth |
|---|---|---|---|
| Revenue | 448 | 693 | +55% |
| EBITDA | 90 | 174 | +93% |
| PAT | 81 | 135 | +67% |
| EBITDA Margin | 20.2% | 25.1% | +496 bps |
| Visa Apps Processed (in Lakh) | 7.14 lakh | 9.83 lakh | +38% |
| Net Cash | N/A | 928 | Robust |
The quarter also saw EBITDA margins expand by nearly 500 basis points YoY, aided by the transition to self-managed operations, notably in China, and synergies from acquisitions like iDATA.
However, margin contraction of ~570bps QoQ was noted due to an increased contribution from ASPL, which operates at lower margins—a tradeoff the company is willing to bear in return for scalable digital growth.
Acquisitions as Strategic Enablers, Not Financial Burdens
In FY25 alone, BLS invested over INR 1,000 crore in strategic acquisitions including:
- iDATA (visa services in Turkey and other key markets)
- Citizenship Invest (CI) (expanding services in immigration solutions)
- Aadifidelis Solutions (ASPL) (financial inclusion & BC services)
Importantly, all acquisitions were funded via internal accruals, with no debt or equity dilution—a rare feat that speaks volumes about BLS’s cash flow discipline and capital allocation prowess.
Notably, 60% of EBITDA growth was organic, with 20% from acquisitions and the rest from operating leverage, suggesting that these deals are not stop-gap measures, but long-term growth platforms.
Visa Business: Resilience and Upside in Global Recovery
The visa and consular segment remains the profit engine, contributing 64% of revenue and 87% of Q4 EBITDA. The segment posted:
- Revenue of INR 441 crore (+19% YoY)
- EBITDA of INR 151 crore (+96% YoY)
- EBITDA margin expansion to 34.2%
The transition to self-managed centers, especially in high-volume regions like China, has boosted revenue per application by 26%, as BLS increasingly captures value through value-added services (VAS).
With the global travel ecosystem normalizing and outsourced visa processing expected to touch 50% of total processing by 2027 (from 40% currently), BLS stands to benefit from both structural tailwinds and improved monetisation per application.
Digital Services: Underappreciated Growth Lever
While traditionally overshadowed by its visa business, the digital services division is rapidly evolving into a robust growth vertical.
- Q4FY25 revenue: INR 252 crore (+226% YoY)
- EBITDA: INR 23 crore (+74% YoY)
- GTV: INR 87,000 crore, including INR 12,000 crore in loans disbursed
By integrating BC services, G2C platforms, and assisted e-services across utilities, welfare schemes, and public sector banking, BLS has consolidated its presence in India’s last-mile digital delivery network.
Although margins are currently lower (~9%), scale, cost optimization, and monetisation of value-added modules (e.g., insurance, micro-credit, e-KYC) are expected to drive improvements over FY26–27.
Balance Sheet Strength and Growth Visibility
BLS ended FY25 with net cash of INR 928 crore, providing ample dry powder for further M&A, dividend payouts, and technology investment. The company’s asset-light model ensures it generates strong free cash flows, even while growing at 30%+.
Key Ratios (FY25)
- ROAE: 35%
- ROACE: 34%
- EBITDA Margin: 29%
- PAT Margin: 23%
- Net Debt/EBITDA: (1)x
Additionally, BLS’s receivables and payables are tightly managed, maintaining a negative cash conversion cycle, highlighting its lean operations and efficient working capital practices.
Valuation & Forecasts
Nuvama maintains its FY26 PAT estimate at INR 641 crore and expects EPS to rise from INR 12 in FY25 to INR 18 in FY27, implying a 16% CAGR in earnings.
| Metric | FY25 | FY26E | FY27E |
|---|---|---|---|
| Revenue | 2,193 | 2,707 | 3,078 |
| EBITDA | 629 | 788 | 910 |
| PAT | 508 | 641 | 741 |
| ROAE | 35% | 31% | 27% |
| EPS (INR) | 12 | 16 | 18 |
| P/E (x) | 32 | 25 | 22 |
At 32x FY25 earnings, BLS trades at a discount to global peers offering lower growth and higher capital intensity. With a proven acquisition strategy, robust cash generation, and increasing exposure to high-margin segments, the stock presents an attractive risk-reward opportunity.
Conclusion
In a market hungry for quality mid-caps with sustainable earnings growth, high RoCE, and minimal balance sheet risk, BLS International ticks nearly every box.
Its transformation from a government visa outsourcer to a multi-vertical, tech-enabled, globally diversified platform positions it well to ride secular themes of global mobility, digital governance, and financial inclusion.
Nuvama’s coverage initiation with a 55% upside target validates this view, and investors may be wise to look closely at BLSIN—not just as a short-term opportunity, but as a long-duration compounding story in India’s evolving services landscape.
Brokerage Verdict: BUY
Target Price: INR 637
CMP: INR 409
Upside Potential: 56%
Valuation Method: SoTP
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Disclaimer: This article is a professional interpretation based on publicly available brokerage research and does not constitute investment advice. Please consult a certified advisor before making any investment decisions.