CAMS IPO: Price band set at Rs 1,229-1,230/share

CAMS, which is the largest registrar and transfer agent of mutual funds with an aggregate market share of approximately 70 percent based on mutual fund average assets under management, has reserved 1,82,500 equity shares for employees who will get these shares at a discount of Rs 122 per equity share. Bids can be made for a minimum 12 equity shares and in multiples of 12 shares thereafter.

The company is going to raise Rs 2,240-2,242 crore at lower-upper end of price band respectively.

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CAMS is a technology-driven financial infrastructure and services provider to mutual funds and other financial institutions with over two decades of experience. CAMS charges a percentage of AUM to AMC and charges more fees from equity mutual funds as compared to other categories of mutual funds.

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"Change in the mix of the mutual fund industry towards higher equity and the buoyant market will be beneficial for CAMS revenue growth. Considering a healthy balance sheet, high return ratio, and market leadership position, IPO will see strong interest across market participants," Jaikishan Parmar, Senior Equity Research Analyst at Angel Broking told Moneycontrol.

"CAMS business model is asset-light, earnings are generously distributed among shareholders. It reported return on equity of more than 25 percent," Parmar said.

The offer would constitute at least 37.40 percent of post-offer paid-up equity share capital.

Great Terrain, an affiliate of Warburg Pincus, held 43.50 percent equity stake in the company at the time of filing RHP on September 11, while NSE Investment held 37.48 percent, HDFC group held 12.51 percent, Faering Capital India around 4 percent and Acsys 1.94 percent.

Equity shares will get listed on the BSE. Kotak Mahindra Capital Company, HDFC Bank, ICICI Securities and Nomura Financial Advisory and Securities (India) are the book running lead managers to the issue. Link Intime India is the registrar to the issue.