BLS E-Services shares have seen a decline of about 30% from their initial listing price of ₹366. The company had a strong debut on February 6, 2024, opening at ₹305 on the NSE, which was 125.93% higher than its IPO price of ₹135. Similarly, on the BSE, the shares debuted at ₹309, marking a 128.89% increase from the issue price. However, since March 5, the stock price has remained below its listing price.
The company entered the stock market in February this year with an IPO worth around ₹300 crores. Funds raised from the IPO were intended for various purposes such as supporting the establishment of BLS Stores, enhancing the existing platform, developing technical infrastructure, and exploring potential acquisitions.
During the three days of the IPO, there was significant interest from both retail and non-institutional investors, with the subscription status reaching 162.48 times according to NSE data.
Dr. Ravi Singh, SVP of Retail Research at Religare Broking Ltd, highlighted that BLS E-Services offers e-government services and business communication services to major Indian banks, but he advised against fresh investments in the stock due to its downtrend and overvaluation. He suggested existing investors place a strict stop at ₹260.
On Monday, BLS E-Services shares closed 2.21% lower at ₹263.55 on the BSE.
Future Plans for BLS E-Services
The company is reportedly considering acquisitions in the current fiscal year (FY25) as part of its expansion strategy. With 21,000 banking correspondent centers across India and partnerships with 15 banks, including State Bank of India, Bank of Baroda, and HDFC Bank, BLS E-Services is actively exploring acquisition opportunities.
Chairman Shikhar Aggarwal mentioned that negotiations are underway with two to three companies, with ongoing due diligence. The company has earmarked ₹28.71 crore from the earlier IPO proceeds of ₹311 crore for potential acquisitions.
Additionally, BLS E-Services aims for organic growth by expanding its BLS Stores. Despite the challenges, the company recorded a 65% increase in net profit for the fiscal year ending in March 2024, reaching ₹33.53 crore compared to ₹20.33 crore in the previous year. Total income also saw an uptick from ₹73.62 crore to ₹78.71 crore, while total expenditures increased to ₹64.29 crore from ₹62.05 crore in FY23.
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