LKP Research has come out with its report on Computer Age Management Systems. The research firm has recommended to ''Subscribe'' the ipo in its research report as on September 19, 2020
LKP Research's IPO report on Computer Age Management Systems
Computer Age Management Services Limited (CAMS) is India’s largest registrar and transfer agent (RTA) of mutual funds with an aggregate market share of ~70% based on mutual fund AAUM managed. The mutual fund clients include four of the five largest mutual funds as well as nine of the 15 largest mutual funds based on AAUM. The size of the mutual fund RTA business was approximately ₹8.6bn in financial year 2019. The industry has grown at a CAGR of 20% in the last four years. As of June – 20, the company has 16 mutual fund clients with an aggregate of over 71.8mn accounts. CAMS currently provides technology-based services including dividend processing, transaction origination interface, payment, transaction execution, intermediary empanelment, report generation, investor interface, settlement & reconciliation, compliance-related services, and brokerage computation. The company provides services in the area of electronic payment collections services business, insurance services business, alternative investment funds services business, banking, and non- banking services business, KYC registration agency business, and software solutions business. The company has a wide network comprising 25 states, five UTs and 278 service centers. CAMS also offers services online through a mobile application.
Valuation and Outlook
At higher price band (₹1,230), CAMS valued at 35(x) FY20 P/E has leadership position, zero debt, healthy cash position and high return ratios. We recommend to SUBSCRIBE.
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