The initial public offer (IPO) of BLS E-Services has been receiving strong response from investors with an overall subscription of 21 times so far on Wednesday, the second day of the bidding process. The category reserved for retail investors was booked the most at 68 times, followed by NIIs at 43 times.

BLS E-Services GMP
The company’s shares are trading with a robust premium of Rs 166 in the unlisted market, compared with an issue price of Rs 135. This translates to a GMP of nearly 122%.

BLS E-Services IPO review
Analysts advised investors to subscribe to the issue for listing gains as well as long-term. They believe the government’s emphasis on ‘Digital India’, and the financial track record over the past few years promises a bright outlook for the future.

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“The PE ratio stands at 33.1x based on the annualized FY24E EPS which appears reasonable compared to peers in the industry. Based on the positives, we give the issue a subscribe rating,” said BP Wealth.

Other details
About 75% of the offer is reserved for qualified institutional buyers, 10% for retail investors and 15% for non-institutional investors.

Net proceeds from the fresh issue will be used for strengthening its technology infrastructure to develop new capabilities and consolidating its existing platforms, funding initiatives for organic growth by setting up BLS stores and achieving inorganic growth through acquisitions and general corporate purposes.

BLS E-Services is a technology-enabled digital service provider, offering business correspondent services to major banks in India, assisted e-services and e-governance services at grassroots levels.

Through its robust network, the company provides access points for the delivery of essential public utility services, social welfare schemes, healthcare, financial, educational, agricultural and banking services for governments and businesses alike in addition to a host of B2C services.

In FY23, the company’s income increased 151% year-on-year to Rs 246 crore, while profit jumped 278% to Rs 20.33 crore. For the six months ended September 2023, total income stood at Rs 158 crore and profit was at Rs 14.68 crore.

Unistone Capital is acting as the sole book-running lead manager to the IPO, while Kfin Technologies is the registrar.

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