CAMS IPO, Bumper Listing ???

About the Company

1. Computer Age Management Services (CAMS) Ltd is a technology-driven financial infrastructure and service provider. 

2. It is India's largest registrar and transfer agent of mutual funds. 

3. As per the Crisil Nov 2019 report, it has a 69.4% mutual fund aggregate market share.

Business Areas

- CAMS currently provides technology-based services including 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.

- 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. CAMS has a wide network comprising 25 states, 278 service centers, and five union territories. 

- It also offers services online through a mobile application.

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.

Company Financials

What is the purpose of IPO??

1. To carry out the Offer for Sale of up to 18,246,600 Equity Shares by the Selling Shareholders;

2. Achieve the benefits of listing the Equity Shares on the BSE.

IPO Issue Details

The Percentage of Offer Size available for Allotment/allocation:

1. QIBs: 50%

2. Non-Institutional Investors: 15%

3. Retail Individual Investors: 35%

CAMS IPO Employees Reservation

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. Click here for more detail.

Positives

- Strong Infrastructure for the company.

- Strong hold in MF Industry and very good from future Perspective 

- The company is technology driven and it is good advantage for the company.

- Strong financials & fundamentals.

Negatives

- 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%.

Personal View

- We will be buying this IPO only for the listing gains. Strong chances of good listing gains.

- For long term also this can be a good holding. 

Dos & Don'ts

- Apply only one lot as the IPO is going to be highly oversubscribed and even if you apply 10 lots you will be allotted only 1 lot at listing.

- Do not apply from different Demat accounts linked with same PAN Details, your subscription will likely get rejected.

- You can apply from different Demat accounts linked with different PAN e.g from your family members account so as to get more chances of allotment