Reduce Computer Age Management Services; target of Rs 2000: HDFC Securities

HDFC Securities recommended reduce rating on Computer Age Management Services with a target price of Rs 2000 in its research report dated May 08, 2023.

Broker Research

May 11, 2023 / 13:59 IST

reduce

26 Aug, 2025 12:21

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HDFC Securities' research report on Computer Age Management Services

CAMS clocked in-line core revenues at INR2.5bn (+2.4% QoQ); however, the disappointment stemmed from a sharp rise in other opex (+16% QoQ) due to higher marketing spends and regulatory audits, driving sequentially flat core income/PAT to INR0.91bn/0.74bn. Continued market leadership in the duopoly RTA market, sizeable entry barriers, and high switching costs position CAMS favourably; however, we are wary of SEBI’s ongoing discussion on further TER cuts that could potentially derail RTAs’ medium-term earnings. We trim our FY24E/25E estimates by 3.2/3.4% to factor in higher opex and delayed accruals in non-MF business.

Outlook

Given the sustained pricing pressure and a modest 9.7/16.3% revenue/OP CAGRs over FY23-25E, we maintain REDUCE with a lower TP of INR2,000 (25.5x Mar-25E EV/NOPLAT + Mar-24E cash and investments; roll-forward multiple adjustment from Sep-24E to Mar-25E).

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