Rating Rationale
April 12, 2019 | Mumbai
BLS International Services Limited
Rating Reaffirmed
Rating Action
Total Bank Loan Facilities Rated Rs.22.5 Crore
Short Term Rating CRISIL A2 (Reaffirmed)
1 crore = 10 million
Refer to annexure for Details of Instruments & Bank Facilities
Detailed Rationale

CRISIL has reaffirmed its 'CRISIL A2' rating on the short-term bank facility of BLS International Services Limited (BIS; part of the BIS group).
The rating continues to reflect the BIS group's established market position in the visa outsourcing services sector, strong ties with Indian diplomatic missions, and comfortable financial risk profile. These strengths are partially offset by tender-based business, susceptibility to changes in regulations and pricing by the Ministry of External Affairs, and large working capital requirement resulting from the master service agreement with the Government of Punjab.

Analytical Approach

For arriving at the rating, CRISIL has combined the business and financial risk profiles of BIS, BLS International FZE (100% subsidiary of BIS), and their step-down subsidiaries. This is because all the companies, collectively referred to as the BIS group, are under a common management and have strong financial linkages in the form of equity share capital, revenue sharing, and loans and advances.

Please refer Annexure - List of entities consolidated , which captures the list of entities considered and their analytical treatment of consolidation.

Key Rating Drivers & Detailed Description
* Established market position
Established in 2005, the BIS group is present in over 62 countries and provides services through 2,325 offices worldwide. Within a decade, it has attained a comfortable position in the visa services outsourcing market. Though it has grown considerably in a short span, sustainability of market position in the long term is a key rating sensitivity factor. The group recorded operating income Rs 793.1 crore in fiscal 2018 and Rs 567.38 crore in the first nine months of fiscal 2019.
* Strong ties with Indian diplomatic missions
The group serves around 20 Indian diplomatic missions in various geographies, which contribute a major part to revenue. Not only has it been able to acquire new tender-based contracts from Indian diplomatic missions at new locations but has also been able to successfully renew arrangements with them. 
* Comfortable financial risk profile
The financial risk profile is supported by comfortable capital structure. Gearing is estimated to remain below 0.5 times with interest cover at around 9-10 times as on March 31st 2019. Gearing was 0.43 time and total outside liabilities to tangible networth ratio 0.82 times as on March 31, 2018. Debt protection metrics remained comfortable with interest coverage and net cash accrual to total debt ratio were at 12.5 times and 1.22 times, respectively, in fiscal 2018
* Tender-based business and susceptibility to changes in regulations and pricing by the Ministry of External Affairs
The contracts with diplomatic missions are generally tender based with a tenure of three years. The contracts have certain pre-requisites such as experience in visa outsourcing, robust credit history, adequate information technology, operational expertise, and strong background check function. This makes revenue susceptible to the risk of non-renewal of contract at the end of the term or inability to bag new contracts. Also, the diplomatic missions regulate the management and pricing of visa application and commission of the outsourcing company. This limits the BIS group's bargaining power. Thus, increased regulation or more stringent pricing by the diplomatic missions could reduce the group's topline. Any change in regulation will remain a rating sensitivity factor over the medium term.
* Large working capital requirement due to master service agreement with the Government of Punjab
The working capital-intensive operations are reflected in estimated gross current assets of 100-150 days due to large receivables of around 60 days because of delayed payments from the Punjab government under the master service agreement. Receivables from the state government were at 59 days (Rs 123 crore) as on December 31st, 2018. The BIS group has been in discussion with the Punjab government regarding closure of the agreement and the payment of dues of more than six months. Working capital is expected to normalize post the payment from the Punjab government and change in the model of the project with advance payments coming to the group. Timely closure of the agreement and receipt of the dues will remain key rating sensitivity factors.


Liquidity is adequate marked by sufficient net cash accruals expected around Rs 45-75 crore per annum against repayments of around Rs 14.8 crore over the medium term. Cash and bank balance was high to the tune of Rs 89.2 crore in FY 18. Further current ratio was comfortable at 2.2 times as on March 31st 2018

About the Group

Established in early 2005, BIS is a specialist provider for outsourcing visa, passport, and attestation services to Indian missions across the world. It serves the diplomatic missions by managing all administrative and non-judgmental tasks related to the entire life cycle of a visa application process. The company is promoted by Mr Diwakar Aggarwal. It was listed on the Bombay Stock Exchange and National Stock Exchange in 2016.

BIS has operations in over 62 countries either through joint venture with a local player or through wholly owned subsidiaries (BLS International FZE and others).

Key Financial Indicators
Particulars Unit 2018 2017
Revenue Rs crore 793.1 637.4
Profit after tax Rs crore 96.5 50.1
PAT margin % 12.1 7.8
Adjusted debt/adjusted networth Times 0.43 0.60
Interest coverage Times 12.5 11.75

Any other information: Not applicable

Note on complexity levels of the rated instrument:
CRISIL complexity levels are assigned to various types of financial instruments. The CRISIL complexity levels are available on www.crisil.com/complexity-levels. Users are advised to refer to the CRISIL complexity levels for instruments that they consider for investment. Users may also call the Customer Service Helpdesk with queries on specific instruments.
Annexure - Details of Instrument(s)
ISIN Name of instrument Date of allotment Coupon
rate (%)
Maturity date Issue size
(Rs cr)
Rating assigned
with outlook
NA Bank Guarantee NA NA NA 22.5 CRISIL A2
Annexure - List of entities consolidated
Names of Entities Consolidated Extent of Consolidation Rationale for Consolidation
BLS E-Services Pvt Ltd Full Indian subsidiary of holding company
BLS E-Solutions Pvt Ltd Full Indian subsidiary of holding company
BLS IT Services Pvt Ltd Full Indian subsidiary of holding company
BLS International FZE, UAE Full Foreign subsidiary of holding company
BLS International Services, UAE Full Foreign subsidiary of BLS International FZE
BLS International Services Norway AS Full Foreign subsidiary of BLS International FZE
BLS International Services Singapore PTE Ltd Full Foreign subsidiary of BLS International FZE
BLS International Services Canada INC Full Foreign subsidiary of BLS International FZE
BLS International Services Malaysia SDN BHD Full Foreign subsidiary of BLS International FZE
BLS International Services (UK) Ltd Full Foreign subsidiary of BLS International FZE
Consular Outsourcing BLS Services INC Full Foreign subsidiary of BLS International FZE
Starfin India Private Limited Full Indian subsidiary of BLS E Services Pvt Ltd
BLS KENDRAS PRIVATE LIMITED  Full Indian subsidiary of holding company
Reired BIS International Services Private Limited Full Indian subsidiary of holding company
BLS International Vize Hizmetleri Ltd. Sti., Turkey    Full Foreign subsidiary of BLS International FZE
Annexure - Rating History for last 3 Years
  Current 2019 (History) 2018  2017  2016  Start of 2016
Instrument Type Outstanding Amount Rating Date Rating Date Rating Date Rating Date Rating Rating
Non Fund-based Bank Facilities  LT/ST  22.50  CRISIL A2      29-03-18  CRISIL A2      08-11-16  CRISIL A2  CRISIL A2 
                    04-11-16  CRISIL A2   
All amounts are in Rs.Cr.
Annexure - Details of various bank facilities
Current facilities Previous facilities
Facility Amount (Rs.Crore) Rating Facility Amount (Rs.Crore) Rating
Bank Guarantee 22.5 CRISIL A2 Bank Guarantee 22.5 CRISIL A2
Total 22.5 -- Total 22.5 --
Links to related criteria
CRISILs Approach to Financial Ratios
CRISILs Bank Loan Ratings - process, scale and default recognition
Rating criteria for manufaturing and service sector companies
Rating Criteria for Software Industry
CRISILs Criteria for Consolidation
CRISILs Criteria for rating short term debt

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