Geojit Maintains 'Accumulate' Rating on CAMS with Target Price of ₹4,425:

Geojit Financial Services has reiterated an Accumulate rating on Computer Age Management Services (CAMS) with a target price of ₹4,425, citing the company's strong industry position and consistent financial performance. CAMS continues to lead India’s mutual fund services sector, serving 10 of the 15 largest mutual funds by Average Assets Under Management (AAUM).

With over three decades of expertise, CAMS holds a dominant ~68% market share in the registrar and transfer agent space, based on AAUM serviced. In Q3FY25, the company managed a substantial ₹46.3 trillion in assets, while equity net inflows surged to ₹97,000 crore—an 89% year-on-year increase.

Strong Growth Outlook Backed by Rising AUM

CAMS delivered a 17% revenue CAGR from FY21 to FY24, driven largely by 18% CAGR in AUM during the same period. Geojit forecasts a ~14% revenue CAGR between FY25E and FY27E, supported by a projected 19% CAGR in AUM, although potential yield compression due to pricing adjustments may slightly temper margins in future quarters.

Valuation and Investment Perspective

With increasing mutual fund penetration across India and CAMS' market leadership, the company is well-positioned to capitalize on industry growth. Backed by a strong balance sheet and consistent return ratios, CAMS offers a compelling long-term investment opportunity.

At a current valuation of 36x (close to its five-year average of 40x), Geojit maintains its Accumulate stance, aligning the fair value estimate at ₹4,425 per share.