Computer Age Management Services or CAMS is a technology-driven financial infrastructure and service provider. It is India’s largest registrar and transfer agent of mutual funds. As per the Crisil Nov 2019 report, it has a 69.4% mutual fund aggregate market share. The article is about cams IPO review.
About the Company
CAMS is currently giving various services like technology-based services. It includes dividend processing, transaction origination interface, payment, transaction execution, dividend processing, intermediary empanelment, report generation, investor interface, settlement and reconciliation, compliance-related services, and brokerage computation.
- As I have mentioned that CAMS gives services in multiple areas like electronic payment, insurance business services, alternative investment services, banking-non banking services, KYC registration business, etc.
- The company has a wide network that spread around 25 states, 278 service centers, and five union territories. CAMS also offers an online service and a mobile app.
Competitive Strengths
1. Largest infrastructure and services provider of mutual fund
2. A diverse portfolio of technology-enabled services
3. Pan-India physical network
4. Scalable technology enabled ecosystem
Company Promoters:
Great Terrain Investment Ltd is the promoter of the company.
Objects of the Issue:
The objects of the Offer are:
1. For carrying out the Offer for Sale of up to 18,246,600 Equity Shares by the Selling Shareholders;
2. CAMS want to achieve the benefits of issuing shares in the Indian Stock Exchange.
3. One of the most important objective behind issuing shares is accquire capital. They are planning to utilize it in extension of business.
CAMS IPO Details
| IPO Date | Sep 21, 2020 – Sep 23, 2020 |
| Issue Type | Book Built Issue IPO |
| Issue Size | 18,246,600 Eq Shares of ₹10 (aggregating up to ₹2,244.33 Cr) |
| Offer for Sale | 18,246,600 Eq Shares of ₹10 (aggregating up to ₹2,244.33 Cr) |
| Face Value | ₹10 per equity share |
| IPO Price | ₹1229 to ₹1230 per equity share |
| Employee Discount | 122 |
| Market Lot | 12 Shares |
| Min Order Quantity | 12 Shares |
| Listing At | BSE |
CAMS IPO Tentative Date / Timetable
| Bid/Offer Opens On | Sep 21, 2020 |
| Bid/Offer Closes On | Sep 23, 2020 |
| Finalisation of Basis of Allotment | Sep 28, 2020 |
| Initiation of Refunds | Sep 29, 2020 |
| Credit of Shares to Demat Acct | Sep 30, 2020 |
| IPO Shares Listing Date | Oct 1, 2020 |
CAMS IPO Lot Size and Price (Retail)
| Application | Lots | Shares | Amount (Cut-off) |
|---|---|---|---|
| Minimum | 1 | 12 | ₹14,760 |
| Maximum | 13 | 156 | ₹191,880 |
CAMS IPO Promoter Holding
| Pre Issue Share Holding | 43.53% |
| Post Issue Share Holding |
CAMS IPO Offer Size by Investor Category
The Percentage of Offer Size available for Allotment/allocation:
- QIBs: 50%
- Non-Institutional Investors: 15%
- Retail Individual Investors: 35%
CAMS IPO Employees Reservation
CAMS IPO has certain reservation rules for its employees. A discount of ₹122 per Equity Share is being offered Eligible Employee Bidding in the Employee Reservation Portion. up to 182,500 Equity Shares are reserved for employees. Note:
- When using UPI as a payment method, the primary account holder in the bank and demat should be the same person. Use of 3rd party UPI ID or 3rd party bank account is not allowed.
- When using ASBA, up to 5 CAMS IPO applications can be applied from the same bank that offers the 3rd Party ASBA IPO application.
- HUF and Minors can only apply using ASBA from the banks that offer the 3rd Party ASBA IPO application. i.e. SBI, Axis bank.
Risks to Investors
- The 4 Lead Managers associated with the Offer have handled 17 public issues in the past three years out of which 6 issues closed below the issue price on the listing date.
- The PE ratio based on diluted EPS for FY 2020 for the Issuer at the upper end of the Price Band is as high as 34.61.
- Average cost of acquisition of Equity Shares for the Selling Shareholder namely NSE Investments Limited is Rs 187.86 per Equity Share and the Offer Price at the upper end of the Price Band is Rs 1,230 per Equity Share.
- Weighted Average Return on Net Worth for Fiscals 2020, 2019, and 2018 is 31.40%.
Company Financials:
| Particulars | For the year/period ended (₹ in Million) | |||
|---|---|---|---|---|
| 30-June-20 | 31-Mar-20 | 31-Mar-19 | 31-Mar-18 | |
| Total Assets | 8,354.53 | 8,025.34 | 7,363.24 | 6,978.48 |
| Total Revenue | 1,634.61 | 7,213.43 | 7,118.08 | 6,578.20 |
| Profit After Tax | 408.25 | 1,734.56 | 1,308.95 | 1,463.05 |
CAMS IPO Review
In the above financials, 3 years’ records are given. As you can see that only in the FY20, 1 quarter result is given. In FY 18, the PAT (profit after tax) was 1,463.05. Next FY 19, the PAT was 1,308.95 and FY 20 has 1.734.56. So it is been noticed that the profit is strong enough for this company. As per the DRHP (draft red herring prospectus) the PE, EPS, RoNW is also good. As per our report, 9 out of 10 top brokers give cams IPO review POSITIVE remarks. You may check the bid details of the company IPO from the official BSE site.
