Computer Age Management Services Ltd Management Discussions

INTRODUCTION

The company is the market leader in the Registrar and Transfer Agency business serving the mutual fund industry and derives about 90% of its revenue from this activity. The Indian mutual fund industry is a large segment of the financial landscape, offering investors a way to pool their money and invest in a diversified portfolio of assets. The Mutual funds are managed by professional fund managers who invest the pooled money in a variety of assets, such as stocks, bonds, and government securities. The industry is regulated by the Securities and Exchange Board of India (SEBI), which oversees all aspects of mutual fund operations. The regulation by SEBI relates to all aspects of the mutual fund operations and are focussed on ensuring investor protection and transparency and this has built confidence of the investors on the industry, fuelling its growth.

The industry has seen significant growth in recent years, with both assets under management (AUM) and the number of investor accounts increasing substantially. The growing popularity of the mutual fund industry among retail investors is arising from the perception of the retail investors who see it as a way to participate in capital markets and benefit from growth in the capital market. Products like Systematic Investment Plans (SIPs) which enable regular savings in smaller instalments over a longer period of time and technology platforms which have made the process of investment simpler have played a crucial role in driving growth, making mutual funds more accessible and convenient for investors. The Mutual funds also offer a wide range of investment options, including equity, debt, hybrid, and thematic funds, catering to different risk profiles and investment objectives.

Registrar and Transfer Agents (RTAs) keep records of investors in a mutual fund and acts as an intermediary between a mutual fund and its investors. RTAs support the Mutual fund industry end to end in its operations and broadly mirrors the performance of the Mutual Fund industry.

The Registrars and Transfer Agents("RTAs") are regulated by the Securities and Exchange Board of India("SEBI") which issues the certificate of Registration for eligible entities to operate. RTAs serving more than 2 crore folios are designated as Qualified Registrar and Transfer Agent("QRTA") by SEBI and enhanced governance mechanism is applicable for those QRTAs. The industry is dominated by three QRTAs and CAMS is one of the QRTAs operating in the country.

CAMS operates in the Mutual fund industry as the RTA with an aggregate mutual fund share of approximately 68% based on Mutual fund AAUM. It has retained its leadership position right from its initial years and has been consistently growing.

As per the report by the Association of Mutual Funds in India (AMFI), Assets Under Management (AUM) of Indian Mutual Fund Industry as on March 31, 2025, stood at Rs. 6,670,186 crore. The AUM of the Indian MF Industry has grown from Rs.10.83 trillion as on March 31, 2015 to Rs.66.70 trillion as on March 31, 2025, more than 6-fold increase in a span of 10 years.

The MF Industrys AUM has registered significant increase in the past decade. The Industrys AUM had crossed the milestone of Rs.10 Trillion (Rs.10 Lakh Crore) for the first time in May 2014 and in a short span of about three years, the AUM size had increased more than two folds and crossed Rs. 20 trillion (Rs.20 Lakh Crore) in August 2017. The AUM size crossed Rs. 30 trillion (Rs.30 Lakh Crore) in November 2020. The Industry AUM stood at Rs. 66.70 Trillion (Rs. 66.70 Lakh Crore) as on March 31, 2025. As against the folio of 10 crore in the month of May, 2021, the total number of accounts (or folios as per mutual fund parlance) as on March 31, 2025 stood at 23.50 Crore (235 million), while the number of folios under Equity, Hybrid and Solution Oriented Schemes, wherein the maximum investment is from retail segment stood at about 18.58 crore (185.8 million).

CAMS operations, technology, digital enablers, customer service and front offices stretched every sinew to ensure high service delivery for these staggering volumes in the mutual fund. The growth in the mutual fund industry necessitates enhanced performance of the RTA industry. CAMS retained its leadership position in the growing industry and its share continued to be ~ 68%.

The company retained its market leadership position with about 67.6% market share. CAMS-services funds which manage Rs. 45.59 Lakh Crore of AUM. The total transaction volume is 892.11 million with a total value of Rs.186 Lakh Crore. CAMS recorded 265 lakh new SIP registrations last year and approximately 400 lakh this year, which is an increase of 51%, amounting to a cumulative value of Rs. 4,899 Crore. Total of 132 NFOs were serviced by CAMS during FY25, with a cumulative amount mobilized of Rs. 73,397 Crore

(CAMSRep) introduced during the year Bima Central, an insurance portfolio management platform aimed at simplifying policy management for customers by aggregating benefits and ensuring claim-readiness. Accessible to those with an electronic Insurance Account (elA) with CAMSRep, Bima Central emerged from industry collaboration to enhance the value of insurance.

The company continued to highlight the value proposition of repository and digital services with life insurance and general insurers. CAMS Rep continued to work with insurers to expand the flow of electronic policies. Insurance repository services received a big boost to its growth prospects with LIC of India finally signing up for IR services with CAMS Insurance Repository as well as with two other Repositories. For the full FY25, dematerialised non-life policies crossed 5lac, which is the highest ever volume from this segment. For the full year, eIA growth was at 75% and policy growth was at 119%. Total e-Policies crossed 1 crore, with 37% of e-Policy volumes added in the financial year, highlighting an increasing preference of eIA by policyholders.

CAMS Payment Services Private Limited. (CAMSPAY)

- The holding company has been issued the certificate of Registration by the Reserve Bank of India to act as the Payment Aggregator. An application has also been made by this wholly owned subsidiary to RBI for issue of the certificate of Registration for carrying out this business. As and when the COR is received from RBI and subject to other requisite approvals the intent is to transfer the payments business to this subsidiary.

CAMS Account Aggregator -

CAMS Financial Information Services Private Limited (CAMS FIS), has been issued with the Certificate of Registration by the Reserve Bank of India as a Non-Banking Financial Company to function as Account Aggregator. The Account Aggregator (AA) ecosystem exited FY25 with 8.25 Crore customers successfully linked in the fiscal. CAMSfinserv grew 229% YOY taking its market share to 11.6% on LTD basis.

CAMS Investor Services Private Limited (CAMS KRA), A wholly owned subsidiary of the company is the second- largest KYC Registration Agency, is rapidly expanding its reach in the capital market. Leveraging AI and automation, the company is offering innovative solutions like 10-minute KYC process to streamline operations of the clients. The focus on operational excellence and strategic partnerships positions us as a preferred fintech solution provider for FY25. CAMS KRA recorded all-time high in revenue of 45.4 Crore in FY25, an impressive 31% YoY growth in FY25 compared to Rs. 34.7 Crore in FY 24. The company went live with many strategic big logos which are expected to add new PANs to KRA, thereby resulting in significant CAMS PAN download and associated revenue in FY 26. In March 25 the company launched "Am I ValidatedRs. campaign, for raising awareness among capital market investors about the crucial role of KYC validation. The initiative recorded considerable investor engagement, enhancing the companys brand visibility.

Sterling Software Private Limited, a wholly owned subsidiary of the Company, continues to provide services as a Technology Solution Provider (TSP) service for the Account Aggregator Industry. TSP takes care of implementation of digital signature and encryption, which might be a "self-build" for a large entity but certainly a "buy" decision for medium and smaller ones. Sterling is the software service provider for the holding company and holds the IP rights for the entire RTA platform.

Think Analytics India Private Limited, subsidiary of the company Offers Software as a Service (SaaS) based products and data science services to its customers in India and abroad and provides analytical solutions suitable for use with the Account Aggregator framework.The company has been steadily expanding capabilities and installations and has commenced an engagement with one of the large public sector Bank and new product variants are going live with multiple other institutions. The company has built a series of application scorecard for a Lending Service Provider (LSP). The company is contemplating appropriate consent management solution and platform for industry to comply with DPDPA and is also looking at reimagining a customer onboarding journey using AI-first approach for Capital Market customer onboarding, in close coordination with KRA

Fintuple Technologies Private Limited, subsidiary of the company has niche technology offerings in the areas of client digital on-boarding, eKYC, fund reports, and other support digital solutions for AIF and PMS and is expanding its footprint as the gateway connecting the digitally savvy consumers to digitally enabled manufacturers and providers, via APIs. The companys Finwyze platform and its product-suite are currently being customized for two large private sector Banks and its Nivruti platform is being customized for the recent NPS POP sign-ups made by the holding company for its CRA operations.

MFC technologies Limited has been incorporated as a Joint venture company and the company holds 50% of the share capital. This company will be offering MF Central a digital solution aimed at enhancing customer service in the Mutual Fund industry. MFCentral is the preferred platform for investors because of its unique single-window facility to address all investors requirement across the entire Mutual Fund landscape in India. Ease of transacting across all the MFs in India through a single window has been one of the pull factors for the investors.

As part of its value offerings the Company is developing various digital products/ applications which enable the investors in mutual funds (who are the ultimate customers) to experience efficient and effective methods for investments. The Company continues to focus on its digital strategies with a slew of digital properties made available to the market for digitalizing the investment journey. These digital properties continued to do well, set new milestones and the Company is now successfully engaging clients with white-labelled formats of these utilities so that the clients digital teams engage with us more deeply.

myCAMS - The Companys mobile app for mutual fund investing for individual investors continues to be the largest mobile app in the Mutual Fund arena with over 7.46 million registered users. Redesigned myCAMS mobile app was launched during the year. This version marks a significant milestone and includes numerous new features and enhancements to improve every aspect of the user experience. The AuM serviced by myCAMS reached Rs.9.98 trillion as at March 31,2025

GoCORP for institutional investors continue to offer differentiated value adding services. The company continues to remain focussed on enrolling more corporates to use GoCORP for their institutional transactions. The total registered users as on 31st March 2025 is about 8500 and the platform services over Rs. 2.6 trillion which is 16% of the total institutional AuM of CAMS serviced funds.

Edge360, the digital platform for distributors and advisors is recording steady adoption and usage. Extensive marketing efforts and webinars helped gain momentum in new registrations, taking the overall registrations to over 90K. Total 34.72 Lakh transaction volume processed in FY25 via edge360 platform.

CAMServ chatbot was revamped to offer a cleaner interface and new financial transaction capabilities. Chatbot is a customized, white-labelled service as there is an increased preference over traditional service channels, which is a testimony to its ease of usage. For a few of the clients, we have built a distributor based chatbot, where distributors can generate transaction links for their investors and send it to investors for completing the transaction. CAMS is working on implementing an NLP model with multilingual capabilities.

digiLoan against MF/LAMF. Loan Against Mutual Funds is an innovative digital lending solution designed to simplify the loan process. By harnessing advanced APIs, LAMF equips financiers and lending platforms with the resources they need to expedite loan approvals and manage liens efficiently. With its emphasis on a paperless experience, LAMF eliminates the burdens of extensive paperwork, offering users a seamless digital interface. CAMS, leveraging its extensive industry knowledge and state-of-the-art technology, enhances the speed of loan approvals, resulting in significantly reduced processing times. This digital solution ensures that borrowers, lenders, and all involved parties enjoy a smooth and efficient lending experience, ultimately transforming the way loans are managed in the mutual fund space. LAMFs rapid growth is driven by its strong value proposition, which includes secure lending features, a seamless digital process, and competitive interest rates from lenders. This has drawn significant interest from various banks and NBFCs eager to adopt the LAMF solution, leading to an influx of new participants in the market.

CAMS WealthServ, the digital onboarding platform for AIF and PMS investors, has been very well received by the Alternatives Industry. CAMS continues to augment the product features and partnerships with custodians, which will significantly strengthen the market position for the product. There has been a strong traction in the sign-ups for WealthServ and so far 200+ sign-ups have been completed.

eKYC utility is being extensively used. Digilocker has been integrated as an additional option to the eKYC solution. An industry first initiative for online updating of contact details and address in KYCs enabling KYC in 10 minutes has been implemented. This is a unique industry-first innovation. Online KYC Modification (Re-KYC) facility for All KRA PANs has also been introduced. This facility allows investors to modify all their KYC details with mandatory DigiLocker validation.

digiInvest/ digiNFO which enables transactions via SMS link continues to see increased usage among intermediaries. NFO investments and Switch transaction links that can be generated directly by distributors and AMCs have been enabled.

The Companys operations as a Central Recordkeeping Agency ("CRA") were launched in the month of March 2022. Our endeavour to provide the best possible services to our Subscribers and other intermediaries is re-emphasized with the release of various new features. In FY25, CAMS CRA registered an YoY growth of 82% in terms of new subscriber onboarding in Non-Government Sectors. Our market share in eNPS is around 9% and the overall market share in retail (non-Govt sector) is around 6.5%.

The Companys Brand salience and superior technology aligned with client business model continues to make CAMS the service partner of choice for the clients. The company has been able to retain its share in the RTA industry at ~68% as of March 2025. There has been significant wins made by the company of both of new AMCs and migration of the existing AMC from the competitor during the financial year and this indicate the large potential the company has in the RTA industry.

The company remains the market leader in AIF and PMS services, serving 210+ fund houses (520+ schemes) with over Rs.2.50 lakh Crore AUM. Our client base includes industry leaders who have chosen CAMS as service partner. We continue to see success in our digital initiatives. The operations at the Gift City Continues to gain traction with ~30 clients outsourcing to CAMS GIFT City. The gift city operations have now expanded beyond AIF and fund administration services for retail schemes are also provided from GIFT City.

The Account Aggregator (AA) ecosystem is ushering in a new paradigm of data empowerment that transcends individual sectors. It is reshaping financial services by democratizing access, enabling all citizens to securely share their financial data and participate in the formal economy. This data-driven empowerment is fuelling the growth of financial services and is also setting the foundation for new industries, use cases, and opportunities beyond finance. The AA framework is poised to become a global model for how digital public infrastructure can drive financial inclusion, efficiency, and innovation. CAMS through its wholly owned subsidiary has emerged as an early mover and is having a market share of more than 10%. This is expected to propel growth of this business segment in the years to come.

The Company now functions as the Central Record Keeping Agency for the National Pension System. It launched its cloud-based Central Record-Keeping Agency under NPS to extend the service to subscribers and the overall ecosystem and continues to engage with the intermediaries on a regular basis to support a strong ecosystem comprising of multiple intermediaries - PoPs, Pension Fund Managers and Annuity Service Providers. The company also remains committed to eNPS and its customer journeys, which offer an alternative channel for B2C business. The corporate client base is expanding, and ties with PoPs is being strengthened through system enhancements, agent network support, and joint marketing initiatives.

The increased focus on the KYC requirements, mandatory issue of the policies in electronic form and the countrys largest insurer joining the Repository system will significantly enhance the business opportunities for the insurance repository business.

These are considered as significant opportunities and the Companys domain expertise acquired over a three decades of being the industry partner, established processes, technology-driven infrastructure, and marquee clients, will enable the Company to capitalize on the growth in these new businesses.

The threats faced by the company has been listed as part of the Analysis. However, the Company has a documented policy for managing the risks/ threats likely to be faced by it.

- The computer resources of the company have also been declared as a critical Information Infrastructure by the Ministry of Electronics and Information Technology which indicates the importance of the information infrastructure of the company. With the growing prominence of technology in all our activities, cyber security is of paramount importance to us. The emerging Data Protection Laws in the country will also pose significant challenges in the way data is managed, and consent is taken from the data owners. The company may need to have increased focus on the data in its possession and may be required to enhance the spending towards data protection.

- The Companys revenue is highly concentrated on the Mutual Fund industry and its few clients. The competition and the regulatory restrictions may drive down total expense ratios, which in turn could drive down the fees that are paid by the clients to the Company.

- The Company is taking all steps to ensure that we follow all applicable laws and regulations applicable to the Company. Any failure in detecting errors in our business operations could expose us to potential losses. Any failure in detecting errors or omissions in our business operations could expose us to potential losses.

The Company has an adequate internal controls system, commensurate with the size and nature of its business. The system is supported by documented policies, guidelines,

and procedures to monitor business and operational performance which are aimed at ensuring business integrity and promoting operational efficiency. All the records are adequately maintained for the preparation of financial statements and other financial information. Apart from internal controls, the Company also audits the efficiency and security of its operations, its information technologies, and data, in accordance with the global standards.

The Company conducts periodic internal audits in line with an audit plan that is drawn at the beginning of the year, which is approved by the Audit Committee. The scope of the exercise includes ensuring adequacy of internal control systems, adherence to management policies and compliance with the laws and regulations of the country.

Internal audit reports are placed before the Audit Committee of the Board of Directors, which reviews the adequacy and effectiveness of the internal control systems and suggests improvements for strengthening them.

This discussion on Financial Analysis is for consolidated financials of the Company during FY 2024-25. The Company is a technology-driven financial infrastructure and service provider to mutual funds and other financial institutions. The FY 2023-24 numbers are shown on comparable basis for all statement of Profit and Loss and Balance Sheet items discussed below.

During FY 2024-25, the consolidated revenue from operations of the Company was at 142,248 lacs as against 113,652 lacs in the previous year.

The Profit Before Tax was 61,866 lacs as against the previous year PBT of 46,685.

The Earnings Per Share was 95.41 as against the previous year which was at Rs. 72.06 per share.

The Company continues to be debt free except for bank guarantees taken for operational requirements which are fully secured by fixed deposits.

Details of significant changes (i.e., change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, have been provided as part of the Notes to the Standalone Financials Accounts (Note No. 38). Additional Ratios are provided below:

Since the Company is engaged in IT enabled services, the inventory ratios are not relevant. Also since there are no borrowings, interest coverage ratio and debit equity ratio are not relevant.

During the year, CAMS continued to be the leader in delivering quality service in the MF industry for all modes of transactions like Physical, Electronic & Digital. To have continuous improvement, CAMS has made significant efforts in maintaining overall quality performance and accuracy levels. The investor satisfaction survey results for FY 25 showed 96.23% of the customers rate the services of the company as very satisfied/Satisfied.

The Company recognizes that risk is inherent in any business activity and that managing risk effectively is critical to the immediate and future success of the Company. The Company has a Board level Risk Management Committee in addition to an internal Risk Management Committee, which monitors the risk-related matters of the Company. A Board approved Risk Management Policy defines the Risk Management framework to identify, assess and manage potential risks and opportunities. This policy provides detailed key tasks to identify, assess, manage, monitor, and report key risk areas across the group. The company has also in place a Chief Risk Officer. The identified risks of the Company are as below:

The Company faces risks in its operations for any error or omission that could lead to significant monetary and reputational losses. The Company has identified the key areas where such risks could exist and taken proactive steps for carrying out process automation and tighter adherence to the established processes.

In view of the nature of its operations, the Company is required to ensure a Business Continuity Plan, which will enable it to provide services on a continued basis even under unforeseen events. The company carries out periodical BCP drills using the infrastructure of the BCP location. However, there can be a risk of any failure in the BCP in any foreseen situation in the future.

The Company is regulated by various regulators and is subjected to periodical audits. The Company is also required to comply with a host of regulations as part of its compliance activities. Non- compliance with any regulations could result in observations from the regulator and can lead to warnings and penalties. For ensuring the compliances, the company has extensive management process and a process for identification of outliers on real-time basis for the known observation primarily, which are getting remediated on an immediate basis. The Company also has an extensive system for monitoring compliances with individual functional heads tasked with specific areas. However, this do not provide assurance that there would be no regulatory action.

Inability to meet the demands of the Clients or adapt to the latest technological changes might affect the Companys business, as our success depends upon the development of technology platforms and applications to conduct our business. In this regard, steps are being initiated to ensure the adoption of the latest technology and to meet the requirements of the clients.

As the Company handles large amounts of data, the Information Security risk is one of the identified risks. The Company has an extensive Information Security Management System ("ISMS") which is headed by a Chief Information Security Officer and has a well-established ISMS policy. The Companys systems are being periodically audited by external agencies. Bit Sight, an agency which monitors the level of the information security has rated the Company very high at a score of 800. This is a market-leading score and vindicates the robust security posture. However, there is always a possibility of cyber risk.

Dependence on Key Managerial Personnel and Senior Management is considered as a risk and the loss of any key person and or inability to attract new talents, reliance on third party service providers in several areas of operations and our inability to have full control over their services would affect the Companys business. Towards mitigating these risks, all the managerial positions have been filled and retention of KMP through ESOPs and Incentive Programs have been initiated

and action to create future Leaders through training, skill certification and workshops have been initiated.

A significant part of the revenue is concentrated from MF Business. Within MF the revenue is concentrated within a group of top clients. Towards this risk, the Company is focusing on enhancing the non-MF revenue. The Company perceives high growth opportunities in Insurance Repository, CAMSPay (payment aggregator business), and services to AIF clients. In addition, the Company has also been appointed as CRA (Central Recordkeeping Agency) for Pension Funds and added Account Aggregator business to broaden the revenue generation sources. Leveraging competencies acquired through Mutual Fund services business, the Company has launched products like Recon Dynamix, Loan against Mutual Funds (LAMF), etc. Irrespective of this additional business, the Mutual Fund services business is likely to remain the dominant business in the near to medium period.

The Company has entered into contractual agreements with various clients, which may contain clauses which might adversely affect our business, on the occurrence of certain events like employee fraud or misconduct or errors and omissions in the operations. The Company has extensive insurance coverage for addressing such liabilities. However, the insurance cover may not be adequate to fully compensate for the loss.

Employee attraction, development and retention are key priorities of CAMS. We believe engaged employees contribute to a higher level of engagement with clients and investors resulting in profitability and growth. Hence making CAMS a great place to work is always our endeavour. Our People strategy has been to develop a culture of learning & growth, building leadership capability to manage growth and to bring out the best in our employees through creating an environment of agility and transformation. We have created several talent pools through academia collaboration to meet our specialized skill requirements. The Company has a robust training and development framework to enable certification in the MF Domain. Fostering innovation and automation through differentiated and high impact recognition programs has been a hall mark of our people excellence practices. Our risk awareness and mitigation programs had heightened our compliance posture. Various communities have been formed which engage employees through various activities which has helped maintain a participative work environment.

The deep domain knowledge of employees has helped us establish our business leadership and market share. Our employees collaborate with precision and synchronization to enable CAMS to be a market influencer for competitive advantage and to keep in tune with the demands of the market. CAMS invests in building a diverse and inclusive environment for our employees. These employees enable the Company to reach out to investors in Mutual Funds across the country. The Companys career development initiatives range from up-skilling using structured in-house programs, specialist certifications to sponsorship of courses at premium management institutions. We assist our employees in creating their individual development plans and facilitate growth through job rotations, internal hiring, and promotions.

We continue to uphold high standards of governance with respect to all statutory compliance and regulatory requirements. We have several avenues for our employees to voice their opinion in a safe and conducive environment. Managers engage in meaningful dialogues and coach employees to enhance their performance.

The operations of the Company do not involve any manufacturing. The Company strives to maintain the highest safety standards; periodic fire drills are carried out at various premises. First aid training is given to a group of employees to handle any eventuality. Feedback from employees are regularly obtained on various health and safety considerations. The offices with a significant number of employees have either an in-house medical centre or tie-up with leading hospitals to provide treatment in case of medical exigencies.