Bumper Debut, BLS E-Services stock lists at 129% premium to the IPO price, BLS E-Services IPO: The stock opened at Rs 305 on the NSE and at Rs 309 on the BSE against an issue price of Rs 135.

Shares of BLS E-Services made a bumper debut, listing at a 128.9 percent premium over the IPO price, on February 6. The stock opened at Rs 305 on the NSE and at Rs 309 on the BSE against an issue price of Rs 135. The listing was in line with analyst expectations of a 125-130 percent premium.

Ahead of the listing, the stock was trading at a 114 percent premium in the grey market, an unofficial ecosystem where shares start trading before the allotment in the IPO and continue till the listing day. Most investors track the grey market premium (GMP) to get an idea of the listing price.

The Rs 311-crore initial public offering was subscribed 162.47 times during January 30 and February 1, the highest subscription among IPOs launched in the current year.

Non-institutional investors (high net worth individuals) were at the forefront, picking up 300.14 times the allotted quota, retail investors 237 times, and qualified institutional buyers 123.3 times the portions set aside for them.

The IPO was entirely a fresh issue of 2.3 crore shares with a price band of Rs 129-135 per share.

The net proceeds from the fresh issue worth Rs 97.58 crore will be used for strengthening technology infrastructure to develop new capabilities and consolidating existing platforms and Rs 74.78 crore for funding initiatives for organic growth by setting up BLS stores. The company will also use Rs 28.71 crore to achieve inorganic growth through acquisitions. The remaining funds will be used for general corporate purposes.

In the period ended on September 30, 2023, the company's net profit came in at Rs 14.68 crore on a revenue of Rs 158.04 crore. Its profit-after-tax (PAT) margin and earnings before interest, taxes, depreciation, and amortization (EBITDA) margin stood at 9.4 percent and 14.23 percent, in H1FY24.

The company derives a substantial portion of its revenue from a single customer, State Bank of India (SBI). In the six months ended September 30, 2023, the largest customer accounted for 59.75 percent of revenue from operations.

The book-running lead manager of the IPO was Unistone Capital, while Kfin Technologies was the registrar. BLS International Services, Diwakar Aggarwal, and Shikhar Aggarwal are the promoters of the company.

BLS-E Services is a digital service provider that offers business correspondence services to major banks in India, assisted e-services, and e-governance services at the grassroots level in India. As of September 2023, the BC vertical contributed 66.05 percent to the total revenue from operations, while e-governance contributed 28.34 percent and assisted e-services 5.61 percent.

The company’s merchants are organized into two categories: BLS touchpoints and BLS stores. As of September 30, 2023, the company had 98,034 BLS touchpoints, including 1,016 BLS stores. Starfin India, Zero Mass, and BLS Kendras are the subsidiaries of the company.