CAMS

IPO Size

`2244.33 Cr

Price Band

`1229-1230 Per Share

Minimum Lot Size

12 Share

Face Value

`10 Per Share

Employee Discount

`122 Per Share

Retail Allocation

35%

Issue Open Date

21 Sep 20

Issue Close Date

23 Sep 20

Listing Date

1 Oct 20

About the Company:

Backed up by Derivative index of India National Stock Exchange (NSE) and Warburg Pincus New York based private equity firm, the Computer Age Management Services Limited (CAMS) has built up a strong reputation in the back-end operations required in mutual funds and insurance business. The technology driven financial infrastructure provided by the company makes it a leading player as registrar and transfer agent of mutual funds. As a technology enabled service solutions partner to Private Life Insurance, Private Equity Funds, Banks, Non-Banking Finance Companies, the company claims to be a B2B service provider. The company is also catering the dividend distribution services of the investors

Outstanding Litigation:

S.No. 1 - Company 2 - Directors 3 - Promoters
Entity Name By the Company Against the Company By the Director Against the Director By the Promoter Against the Promoter
Criminal cases 23.35 5.1 - - - -
Material civil cases - Not Quantifiable - Not Quantifiable - -
Taxation matters - 142.89 - - - -
Regulatory Procedings - - - - - -
Amt. (In Million Rs.) 23.35 148 + - - - -

Financial Statements:

Income Statement FY19 FY18 FY17
Gross Operating Income 7114.96 6614.52 5026.38
Cost of Employee & Inventory 3804.35 3204.11 2265.01
Other Expenses 693.19 663.27 503.61
EBITDA 2617.42 2747.14 2257.76
Depreciation 503.96 402.41 305.53
Interest 104.73 78.9 60.31
Profit Before Tax 2008.73 2265.83 1891.92
Tax 699.78 802.77 649.77
Profit After Tax 1308.95 1463.06 1242.15

Recommendation

As per CA Ajay Chouhan, SEBI Registered Research Analyst, recommendation is to ‘Subscribe’. The Computer Age Management Services (CAMS) Limited as a registrar and transfer agent claims to carry an aggregate market share of 70 percent (approx.) based on mutual fund average assets under management (AAUM) managed by its clients and serviced by them till July 2020. With the availability of single competitor and that too in unlisted space, the company is likely to enjoy the valuations of a monopoly company on the Indian bourses. The company is backed up by National Stock Exchange (NSE) and Warburg Pincus New York based private equity firm, which makes it a more promising one. At a P/E multiple of 44.85 (considering the EPS = 26.75 of FY19), the issue price seems to be fairly valued.

Promoter of the Company

The promoter of the company is Great Terrain Investment Ltd.

Peer Comparison

In the listed space, the company will enjoy a decent premium due to its monopoly feature but in the unlisted arena, the company faces competition from Karvy Fintech (now named as 'KFintech') and Franklin Templeton Asset Management (India) Pvt Ltd. (FTAMIL). Whil, the whole market is dominated by CAMS and KFintech as FTAMIL caters investors of Franklin Templeton Mutual Fund only.

Objectives of the Issue

Offer for Sale

The object of the Offer for Sale is to allow the shareholders to sell an aggregate of up to 18,246,600 Equity Shares held by them. The company will not receive any proceeds from the Offer for Sale. Offer for Sale Size is of 18,246,600 Equity Shares of ₹10 aggregating up to ₹2,258.00 Cr. The net proceeds from the fresh issue will not be utilized by the company as the sole purpose is to get the listing benefit on the BSE index.