ICICI Direct's research report on Computer Age Management Services
CAMS posted a steady set of numbers in terms of business growth, which was in line with industry. A similar performance was reflected in its topline growth while cost controls and reduced tax boosted bottomline. For CAMS, average assets under management (AAUM) serviced increased 19.2% YoY, 7.3% QoQ to Rs 22.3 lakh crore, largely in line with the industry AAUM growth of 18.9% YoY. Equity AAUM increased 18.5% YoY, 12.1% QoQ to Rs 7.9 lakh crore (calculated) while debt AAUM surged 19.6% YoY to Rs 14.4 lakh crore. On a sequential basis, equity asset mix increased marginally by 1% to 35%. Transaction volume growth rose 5% QoQ to ~8.2 crore vs. flattish growth of 1% in previous quarter. SIP book rose 5% QoQ to ~2.1 crore while number of SIP transactions processed was up 5% QoQ to ~6.1 crore. Increasing traction in various business parameters has enabled CAMS to maintain its dominant position with a market share of 70.1% in MF servicing.
Outlook
We prefer platform oriented businesses with market leadership. Therefore, we revise our target price to Rs 2800/share (earlier Rs 2100), valuing the stock at ~51x FY23E EPS. We maintain BUY.
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