NSE-backed Computer Age Management Services (CAMS) fixed the price band for its initial public offer (IPO) at Rs 1,229-1,230 per share on Wednesday. The offer will open for public subscription on September 21 and close on September 23. Chennai-headquartered CAMS is co-owned by NSE Investments, Warburg Pincus, Faering Capital ACSYS Investments and HDFC Group. The CAMS offering will see the sale of 1.82 crore equity shares or 37.4 per cent stake by NSE Investments, the subsidiary of National Stock Exchange (NSE). In a virtual press conference on Wednesday, the company informed that the bidding for anchor investors will be held on Friday, September 18. “Considering a healthy balance sheet, high return ratio, and market leadership position, IPO will see strong interest across market participants,” said Jaikishan Parmar, Senior Equity Research Analyst at Angel Broking Ltd
CAMS IPO will be the third IPO this month after receiving a robust response from Happiest Minds Technologies and Route Mobile IPOs. While this will be the fifth IPO this year, considering the listing of SBI Cards and Payment Services in March and Rossari Biotech in July. According to the company, the initial share sale is likely to fetch Rs 2,240 crore to Rs 2,242 crore.”CAMS charges a percentage of AUM to AMC and charges more fees from equity mutual funds as compared to other categories of mutual funds. Change in the mix of the mutual fund industry towards higher equity and the buoyant market will be beneficial for CAMS revenue growth,” Parmar added.
The book running lead managers to this issue are Kotak Mahindra Capital Company Ltd, HDFC Bank Ltd, ICICI Securities Ltd and Nomura Financial Advisory and Securities (India) Pvt Ltd. While the registrar to the offer is Link Intime India Private Limited. “Great Terrain is an affiliate of Warburg Pincus holds 43.8%, NSE Investment holds 37.7%. However, through IPO NSE investment is selling an entire stake. HDFC group holds 12.6%. CAMS business model is asset-light, Hence, earnings are generously distributed among shareholders. It reports RoE of more than 25%,” Parmar said.
According to the CRISIL report, CAMS is India’s largest registrar and transfer agent of mutual funds with an aggregate market share of approximately 70 per cent based on mutual fund average assets under management (AAUM) during July 2020. The objectives of this offer are to carry out the offer for sale (OFS) of up to 18,246,600 equity shares by the selling shareholder and achieve the benefits of listing the equity shares on the BSE, the company said in Red Herring Documents.