CAMS Q4 Results Review - Positives Seems Somewhat Priced In: Yes Securities

Yes Securities Report

This particular quarter saw a less than normal rise in Computer Age Management Services Ltd.'s revenue from mutual fund business for a given rise in AUM despite rise in share of equity in AUM:

The rise in revenue was about 60% plus for a given rise in AUM compared with 70% generally expected. This was mainly due to rise in scale customers, which marginally add lesser yield. However, there is no change in assumptions and going forward, normal telescopic formula would be expected to be applied.

Non-asset based mutual fund revenue outpaced asset-based mutual fund revenue and non-mutual fund revenue outpaced both:

The non-asset based revenue growth has been higher this quarter and management does not see any great moderation coming. The share of non-mutual fund business to increase by around 2% every year. KRA has been the biggest engine for non-mutual fund revenue growth, followed by CAMSPay and then AIF business.

We maintain Add rating on CAMS with an unchanged price target of Rs 3500:

We value CAMS at 35 times FY26 price/earning at which CAMS would trade at 14.0 times FY26 price/book.

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