Computer Age Management Services Limited — Q3 FY26

Computer Age Management Services Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=d5QawFB388A Published: 3 months ago

0:00 Ladies and gentlemen, good day and welcome to computer age management services Q3 FY26 earning conference 0:07 7 seconds call. As a reminder, all participants lines will be in the listenonly mode and there will be an opportunity for you to 0:14 14 seconds ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then 0:23 23 seconds zero on your Touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nikbunch S. Thank you and over to you sir. 0:34 34 seconds Thank you Hina. Good morning everyone. 0:37 37 seconds Welcome to Q3 and 9 months FI26 earnings conference call of computer age management services limited. From the management today we have with us Mr. 0:48 48 seconds Anoj Kumar MD and CEO, Mr. Ramcharan CFO and Mr. Anish Savlani head investor relation. Before we proceed to the 0:57 57 seconds opening remarks, I would like to give a small disclaimer that this conference may contain certain forward-looking statements about the company which are 1:05 1 minute, 5 seconds based on beliefs, opinions and expectations of the company as on date. 1:10 1 minute, 10 seconds These statements are not guarantees of future performance and involve risk and uncertainties which are difficult to predict. A detailed disclaimer has been published in the investor presentation. 1:21 1 minute, 21 seconds Now I would hand over the conference to Mr. Rano Kumar. Thank you and over to you sir. 1:28 1 minute, 28 seconds Hey good morning everyone. Uh thank you Niko. 1:31 1 minute, 31 seconds Um I welcome all the participants to this uh 3Q earnings call of CAMS. Uh 1:39 1 minute, 39 seconds sticking to our usual format. Um we will go through parts of the deck and we'll do that in about 20 minutes to have enough time to take your questions. 1:50 1 minute, 50 seconds As you would have seen yesterday uh when we published the results, it's been a very solid quarter for CAMS. 1:59 1 minute, 59 seconds And why do I say that? You know that um exactly a year back in Jan uh we had spoken about the price reset 2:07 2 minutes, 7 seconds that price reset came in 4Q of last year and 1Q of this year. So the comparison the year-on-year comparison is still 2:14 2 minutes, 14 seconds with a large base. uh this is perhaps the last quarter in which we will have a comparison with a larger base while the current year's uh revenue has taken the 2:23 2 minutes, 23 seconds price adjustment but uh in that context u this was a remarkable quarter 2:29 2 minutes, 29 seconds our enterprise revenue grew 5.5% yearonear and like I said the year-on-year number for another quarter 2:37 2 minutes, 37 seconds will not look uh like it's a double- digit number it'll continue looking single digit but the Q revenue growth was 3.6%. 2:48 2 minutes, 48 seconds Uh which was a very solid growth. Non MF on a quartertoquarter basis u over last 2:54 2 minutes, 54 seconds year grew over 24%, you know that a stated endeavor has been to grow this over 20%. So this was a strong quarter. 3:04 3 minutes, 4 seconds Absolute eida rupee aida climbed to the highest ever. Now you will recollect that the highest ever absolute aid was 3:12 3 minutes, 12 seconds in the range of 173 cr in 3Q of last year. So exactly a year uh after that uh 3:19 3 minutes, 19 seconds we are at 179 cr. Do keep in mind that this takes into account the labor code adjustment largely gradually related. 3:28 3 minutes, 28 seconds Some of the other notifications uh a will not be so impactful and b uh will be done when they're announced. But that cost of about 2 and a half to three 3:36 3 minutes, 36 seconds crores has been absorbed in the base. So uh the absolute rupee a bit is remarkable. What is also remarkable is 3:44 3 minutes, 44 seconds that percentage profit after the labor code u adjustment. Every 3:50 3 minutes, 50 seconds other growth cost that we have incurred uh is now at 46%, you will remember that this was 43 and some change about four 3:59 3 minutes, 59 seconds quarters three quarters back. So in these three quarters uh 1 Q of this year, 2Q of this year and 3Q is climbed 4:07 4 minutes, 7 seconds back from about 43 and a half to 46 which I think is a remarkable vindication of uh the overall productivity drive and efficiency that 4:15 4 minutes, 15 seconds we've been able to uh build into the system. 4:19 4 minutes, 19 seconds Specifically on MF uh our AUM crossed 55 lakh crare number remains intact at 68. 4:30 4 minutes, 30 seconds The year-on-year growth was 18%, now in most years, you know that AUM growth was about 20%, if you take the last 10 year 4:38 4 minutes, 38 seconds keer and that 20% used to be composed of about 12 to 13% of marktomarket gains, 4:46 4 minutes, 46 seconds about 7 to 8% of net sales. Uh this 18% number has happened despite the fact that marktomarket gains are lower. So 4:54 4 minutes, 54 seconds that just uh is a good indication of the resilience of the system and of the faith that the Indian you know common investor has in the delivery made by the 5:02 5 minutes, 2 seconds mutual fund industry within this uh equity assets a very very handsome number crossed 30 lakh cr for 5:10 5 minutes, 10 seconds us market share which about 5 years back this number used to be about 60% you've been watching this number so have I is 5:19 5 minutes, 19 seconds crept up to 66.4 four one largely in uh response to the expansion of equity as 5:26 5 minutes, 26 seconds an asset class within the overall MF assets but you cannot deny the share gain part of it the 60 to 66 is exactly 5:34 5 minutes, 34 seconds a share gain and like the chart says 70 basis points up year on year uh equity 5:41 5 minutes, 41 seconds net sales at 84,000 cr although you know that in a great quarter this number is almost like 1.25 25 to 1.5 lakh cr to 5:50 5 minutes, 50 seconds that extent a slightly smaller number but what I'm very happy about is the market share of 71% which is almost a percent up compared year on year you 5:59 5 minutes, 59 seconds know this is the uh the most intensely operative from an operations perspective and the most revenue part of our entire 6:07 6 minutes, 7 seconds uh AUMX new registrations which have been in the range of 1.2 to 1.3 cr every 6:14 6 minutes, 14 seconds quarter uh stayed at 1.6 6 cr uh grew 18% significantly ahead of industry growth 6:22 6 minutes, 22 seconds and I I think just the fact that uh some of the new AMC launches as well as the CAM's base uh clientele has performed 6:31 6 minutes, 31 seconds very well in this area. Uh SIP collections uh grew to almost uh 18 19,000 cr a 6:40 6 minutes, 40 seconds month. So 55,000 56,000 cr in the quarter. Again a handsome number growing 20% year on year and this again is great 6:47 6 minutes, 47 seconds vitication of the attitude of the Indian investor and his faith in the industry. 6:51 6 minutes, 51 seconds Uh live SIPs uh as a count expanded 8% year on year is a 65.2% market share. 6:59 6 minutes, 59 seconds Unique investors you can see grew ahead of industry. Uh Carnelian Asset Management came in as a new AMC client. 7:09 7 minutes, 9 seconds uh SIF is beginning to become a very popular well it's too early for me to say very popular but I would say a 7:17 7 minutes, 17 seconds interesting product class where a lot of AMC's want to participate as of today we have SBI TATA 7:27 7 minutes, 27 seconds uh both launched in the past quarter quarter gone by and then in the month of January we've had ICIC band launch but 7:34 7 minutes, 34 seconds you will see a lot more launches and I think this is net accreative to the uh to the stack of the AMC's because this 7:42 7 minutes, 42 seconds was supposed to bring in money uh from a little more uh you know risk-taking investor class uh an investor class 7:51 7 minutes, 51 seconds which was doing uh you know FNO and day trading kind of stuff for them to come into this asset class it's a broader product offering so it's great news for 7:59 7 minutes, 59 seconds us we already 2400 cr and with 4 AMC's live uh gift city retail fund launches 8:07 8 minutes, 7 seconds uh tardam MF launched the first retail inbound fund. This was live. Uh PPFS and DSP had launched the outbound funds. 8:15 8 minutes, 15 seconds This interest we believe uh will continue to grow over a period of time. 8:18 8 minutes, 18 seconds Early days yet uh but the interest of the domestic investor in uh in participating in overseas 8:26 8 minutes, 26 seconds offerings and the interest of the overseas investors to find a reasonable way to come in through gift city. I think uh they will be the two props on 8:34 8 minutes, 34 seconds which this entire offering will be built. So very happy that uh during the year as we have said earlier we took six 8:41 8 minutes, 41 seconds AMC's live uh we took uh a couple of uh uh SIFS live we expanded the gift city 8:49 8 minutes, 49 seconds offering and we did many other things I'll just come to that but from an activity and milestone perspective a fairly productive quarter and from a 8:57 8 minutes, 57 seconds financial result perspective very solid quarter move to the next uh on the nonMF side uh the revenue contribution has expanded to 14.5%. 9:09 9 minutes, 9 seconds Uh we had said almost about 9 months back that we were in the purpose of a business transfer of the K business of NSE uh into CAMS. 9:20 9 minutes, 20 seconds Uh this process got concluded. Uh now the business is with CAMS live with us. 9:27 9 minutes, 27 seconds uh a great integration uh adds more than a million pounds to our overall kitty and uniquely positions us with as the 9:35 9 minutes, 35 seconds second largest K. The gap between the second and third therefore has widened. 9:40 9 minutes, 40 seconds Uh CAM's K you know that uh the account opening momentum in capital markets has been slow. Uh while in mutual funds the 9:48 9 minutes, 48 seconds folio account expansion remains intact but uh in the broader capital markets the depository and broking account momentum has been slower. Despite that, 9:57 9 minutes, 57 seconds uh, CAM's K grew revenue both, uh, on a year-to-year basis for the quarter as well as in sequential quarters. 10:04 10 minutes, 4 seconds Uh, CAM's pay was, uh, was a great performer. I think if you look at the 10:10 10 minutes, 10 seconds base, just their base business, grew 24% for the quarter over the past year. If 10:17 10 minutes, 17 seconds you add to this the PG business which is just about a year in the making uh that added the balance part of the growth. So 10:26 10 minutes, 26 seconds it's good to see a new product gain acceptance faster than what you normally see. So that 59% is a sum of A and B. A 10:34 10 minutes, 34 seconds is the base business which grew 24% the balance is the PG business. Uh alternatives uh grew 16% in revenue year 10:43 10 minutes, 43 seconds on year. am now exceeds three lakh cr the 50% of the outsource market that milestone remains intact I certainly 10:51 10 minutes, 51 seconds want to call out that while serve or the digital onboarding platform is not a large revenue accreative uh uh revenue 10:59 10 minutes, 59 seconds momentum business but it's a very good uh client hook for us uh 250 mandates almost 200 plus live and we will 11:07 11 minutes, 7 seconds continue and it's a vision to scale up to 500 and even beyond that and the market has uh the ability to absorb all 11:14 11 minutes, 14 seconds of that uh cancer rep grew revenue in the third quarter 15%. 11:20 11 minutes, 20 seconds Uh added uh you can see the numbers we crossed overall uh 1 cr ei.3 cr uh policies market share at 40%. 11:30 11 minutes, 30 seconds Again I would say that uh the true momentum of this business the true impact of what BMA central can do the 11:37 11 minutes, 37 seconds true impact of demand and insurance we still scratching the surface uh LIC which had agreed to come in um you know 11:46 11 minutes, 46 seconds into dematting of new issuance of policies uh that was declared in March April last year uh they're near live u 11:53 11 minutes, 53 seconds uh they've commenced but I think the true momentum of that and the rest of the market expanding their acceptance uh is a slow process but will happen and I 12:02 12 minutes, 2 seconds think uh uh I think we are very very hopeful of uh continuing to scale these things. Uh Beamer central as a unique 12:10 12 minutes, 10 seconds offering for managing your insurance portfolio uh has continued to get awarded 12:18 12 minutes, 18 seconds recognized in multiple forums. You've seen some of that in our website. You've seen some of that in the various u press 12:25 12 minutes, 25 seconds conferences releases our LinkedIn posts etc. So very happy that from a product development culture 12:32 12 minutes, 32 seconds uh that um you know the the moment that we started almost five six years back to deeply uh build a product and a 12:41 12 minutes, 41 seconds tinkering culture inside the company to have multiple offerings obviously we don't want a dozen because you can't focus on a dozen but to have uh maybe 12:49 12 minutes, 49 seconds four or five core offerings which will drive growth I think uh this is a nice pointer towards the future 12:56 12 minutes, 56 seconds uh on the DPDP P act implementation where there are various components of what a good offering should look like but from a consenting perspective think 13:04 13 minutes, 4 seconds 360 has launched consent pro you would have seen some PR on this and we're expecting this to be a revenue business in the coming quarters so like I said 13:13 13 minutes, 13 seconds overall coming out of whatever happened during the year a slow uh you know a slow year for capital markets some 13:20 13 minutes, 20 seconds backdrop of price readjustment some backdrop of slowing down of capital market new accounts etc. In the light of 13:28 13 minutes, 28 seconds all that, I think uh both from a growth and efficiency, margin and revenue growth perspective, a very solid quarter. I will pause here and hand over 13:37 13 minutes, 37 seconds to Ram Chur and then uh we will come back to the Q&A then thank you Anoj. Um I'll just summarize 13:45 13 minutes, 45 seconds the numbers in a few minutes. As Amul said it was a very solid quarter in terms of AM you know quarteron quarter the AM grew around 5.3%. 13:55 13 minutes, 55 seconds And uh as we had uh kind of indicated and guided over the earlier quarters the yield impact of the uh onetime reset uh 14:03 14 minutes, 3 seconds the tail impact was there in last quarter and this said we this quarter we said that we'll be back to the original you know equation in terms of asset to asset fee growth. Happy to say that the 14:12 14 minutes, 12 seconds asset based revenues also grown around 3.8% 48% quarteron quarter which is kind of almost back to the uh back to the same kind of equation that we are used 14:19 14 minutes, 19 seconds to in the past. Uh yields also depletion was much better than what was guided. It was uh less than 1.5% quarteron quarter. 14:27 14 minutes, 27 seconds So from that perspective we are back to steady state from a yield perspective which was the bigger concern over the last 9 months because of the yield 14:35 14 minutes, 35 seconds reset. So overall the revenue grew around 3.6% quarteron quarter and 5.7% yearon year. uh the MF revenue uh grew 14:44 14 minutes, 44 seconds on the back of the asset growth as well as the stable yields uh to 3.3% quarteron quarter and the non-mutual fund revenue uh which was almost 5% 14:52 14 minutes, 52 seconds quarter on quarter and uh 24 plus% almost 25% yearon year as you as you recolct that we have generally have a target of growing more than 20% in the 15:00 15 minutes non-mutual fund revenue. So barring the first quarter where you know there was little subdued we have kind of reached this number and confident that going forward this 20 plus percentage of 15:09 15 minutes, 9 seconds non-mutual fund business will happen this is all on the back of a great business growth in cams pay and their card offerings but across the board 15:17 15 minutes, 17 seconds there has been increase in the businesses af has increased rep has increased and so has k even in a tough uh market so the non-mutual fund back on 15:26 15 minutes, 26 seconds track mutual fund yields uh absolutely back on track uh and from a profit perspective we posted strong earnings things uh our EBIT which was as you may 15:34 15 minutes, 34 seconds recollect went up to 43% a few quarters back came to 44 now is at 46%age um uh and um and that is kind of a 15:42 15 minutes, 42 seconds almost a 140 bits increase on a quarter-on quarter basis so uh we are again firmly back on the track of what 15:49 15 minutes, 49 seconds we have said in in terms of margins 45% plus and we continue to have a good cost control backed by automation 15:56 15 minutes, 56 seconds productivity increases which is keeping the cost line increase subdued we had indicated at the beginning of the year that if we are increasing cost by less than 11% I think that's the target and 16:05 16 minutes, 5 seconds we are well on target to have the cost increased to be 10% on a year-on-year basis. So on the back of uh good cost control u stable yields good growth in 16:13 16 minutes, 13 seconds non-mutual fund businesses we have posted strong earnings for the quarter at 46%age uh this again as an said I'd like to 16:21 16 minutes, 21 seconds reiterate that uh you know as uh required under our institute guidelines we have taken a one time charge of the labor code revamp which 3 crores 2 0.8 8 16:30 16 minutes, 30 seconds crores as a part service cost in our P&L. So in spite of that we are able to post very strong numbers on a quarterly basis. Uh the board had declared has 16:39 16 minutes, 39 seconds declared a dividend of 3.5 rupees and uh so we're keeping up with our dividend declaration policy of 55% of profits being distributed and our rose return on 16:47 16 minutes, 47 seconds capital impart continues to be very impressive at close to 40%age. Uh there are some amount of there is some amount 16:54 16 minutes, 54 seconds of uh you know uh decline in the non-asset based revenue. you would have seen on a year-on-year basis but as we continue to indicate the non- asset 17:02 17 minutes, 2 seconds based revenue is not driven by any notily driven by transactions or an am growth there are four or five components to it uh one of the major component of 17:10 17 minutes, 10 seconds that is the out-of- pocket expenses and also there is a component of the new NFO fees and this quarter when compared to the last year there was a decline uh in 17:18 17 minutes, 18 seconds the NFO launches um when compared to last quarter and there was also decline in the out of pocket expenses the out of- pocket expenses is a revenue line 17:26 17 minutes, 26 seconds item and a cost line item so it is not profit acive and hence you know the decline in the uh non-asset based revenue does not impact the 17:33 17 minutes, 33 seconds profitability. So this is a broad summary of uh what we've seen from a revenue and cost perspective and eBida margins. I now hand it over to the moderator and we can open it for Q&A. 17:47 17 minutes, 47 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone 17:54 17 minutes, 54 seconds telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a 18:03 18 minutes, 3 seconds question. Ladies and gentlemen, we will wait for a moment while the question Q assembles. 18:12 18 minutes, 12 seconds The first question is from the line of Supratim Duta from Jeff. Please go ahead. 18:18 18 minutes, 18 seconds Hello. Um, thanks for the opportunity. I have three sets of questions. you know firstly you know wanted to understand 18:26 18 minutes, 26 seconds how would this uh if you know the loss of five basis point exit uh TR load for mutual funds impact you know you have 18:35 18 minutes, 35 seconds had one round of renegotiation of contracts last year but would this result in another round of renegotiation of contracts and you know what kind of 18:43 18 minutes, 43 seconds you know impact could we expect from that and over what period that would be the first one secondly you know wanted 18:49 18 minutes, 49 seconds to understand you know how is the margins in the nonMF business currently tracking and um you know what kind of 18:58 18 minutes, 58 seconds operating leverage are we able to get there uh lastly you know on the payment aggregator and the payment gateway 19:06 19 minutes, 6 seconds business um there has been you know strong growth there how about the base business has only grown by around 25%. 19:14 19 minutes, 14 seconds And when I look at you know other businesses well the growth has been somewhere around you know 17 18% in most businesses given their smaller scale 19:23 19 minutes, 23 seconds just wanted to understand what would result in these businesses being able to grow faster uh as compared to the 19:30 19 minutes, 30 seconds current runway those those are my questions you sure uh thanks so I'll I'll try to take 19:38 19 minutes, 38 seconds this in order uh on the AMC's and uh their TA yards. 19:46 19 minutes, 46 seconds Sorry, I'm just continuing to hear. 19:51 19 minutes, 51 seconds You may want to go on mute. There is a bit of background at your end. 19:55 19 minutes, 55 seconds Yes, Supreme. Uh maybe there is an Yeah, okay. All right. Yeah, this is a lot 20:03 20 minutes, 3 seconds better. So on the overall TR adjustment um you I'm sure have been tracking this closely that the uh net dispensation 20:12 20 minutes, 12 seconds being proposed is u is is uh of marginal impact not a humongous impact on the 20:21 20 minutes, 21 seconds there are some benefits there are many puts and takes but I think there are some benefits on the GST side and then there could be uh some dent in what they 20:30 20 minutes, 30 seconds can charge uh because of the exit load going away. Uh when you take these together, we believe that most of our 20:37 20 minutes, 37 seconds clientele will not be impacted uh from a from any uh negative impact perspective. 20:44 20 minutes, 44 seconds uh some of the large clients may be impacted like you know that for people who run P&Ls or total TR regimes of 140 20:54 20 minutes, 54 seconds 150 bips at the largest coming to maybe 190 200 bips uh for these smaller AMC's 21:01 21 minutes, 1 second uh this will be a a small reset to make now will they come to us for any conversation etc we don't have any 21:08 21 minutes, 8 seconds indication right now uh that all of that will happen we've always stated that the amount of value we sell for the price we 21:15 21 minutes, 15 seconds charge a is very large and secondly it continues to scale every year. So we believe that we have full justification to retain the prices. Uh right now I 21:25 21 minutes, 25 seconds think we should just wait for any conversation to happen. First of all for this final regime to settle down uh if it settles down in the first quarter of 21:33 21 minutes, 33 seconds next year and then for any conversation to happen. Even if conversations happen we do not believe that this will be of a very large impact to us. Like we've said 21:40 21 minutes, 40 seconds in the past the impact could be uh I mean the the the boundaries of the impact could be 20 25 crores overall for 21:48 21 minutes, 48 seconds camps but we will wait and see. I don't want to jump into conjecturing on numbers and you know making estimates till we have a very clear view of what 21:57 21 minutes, 57 seconds the impact is and what they are planning to do with this. Uh that's part one of your question on the nonMF business. uh 22:05 22 minutes, 5 seconds the only way I would like to explain this to you I'll split the uh answer in 22:11 22 minutes, 11 seconds a few parts. One businesses which are purely platform so CAMS K and CAPS rep 22:20 22 minutes, 20 seconds are two great examples of purely platform businesses uh they have the ability to make a 22:27 22 minutes, 27 seconds bidder in the 30 to 40% range. Camskar is already there which mean it it makes 22:34 22 minutes, 34 seconds an AITA in that range. Uh from there the smallest ones are loss making because it 22:41 22 minutes, 41 seconds takes a revenue line of about anywhere between let's say 12 to 15 cr rupes of revenue line for these uh businesses to 22:49 22 minutes, 49 seconds absorb cost. They are they all have a component of fixed cost. So some of them are loss making which still are not at break even. Uh insurance is near break 22:58 22 minutes, 58 seconds even but not at break even. Pension is lossmaking. Account aggregate is lossmaking. So overall it's our aspiration to move this entire portfolio 23:06 23 minutes, 6 seconds of nonMF. It will not go to 40 to 50% AIDA easily. That will come after maybe 5 6 7 years. But in the next couple of 23:14 23 minutes, 14 seconds years it's our attempt to drive this to about 25 to 30% aida. Uh we believe that is possible. This business now has a 23:22 23 minutes, 22 seconds base of about 230 to 40 cr is growing at the rate of about 40 to 50 cr a year. 23:28 23 minutes, 28 seconds And I think the the objective for the management team is to move a large part of this increment of revenue into the bottom line and and because of the uh 23:37 23 minutes, 37 seconds platform nature of most of these businesses like I said rep and K are two great examples. Payment is also a a very 23:44 23 minutes, 44 seconds very relevant example of of a platform business. So we very hopeful of driving that's the internal target to drive them to 25 to 30%. 23:53 23 minutes, 53 seconds Uh the third part of your question was that in CAM's pay uh what's happening uh what is the growth trajectory as you 24:01 24 minutes, 1 second know that from a portfolio perspective you've stated that nonMF should grow 20% plus within that you will remember that 24:09 24 minutes, 9 seconds we had two breakaway years when uh K grew very fast they almost doubled themselves in 3 years there was a time 24:18 24 minutes, 18 seconds when Aif grew very fast and I think in the last two years we've seen camps pay grew very fast which means camps pay 24:25 24 minutes, 25 seconds used to be under 30 cr business 2 years back they scale from 30 to 50 50 to you know close to 70 this year we see them 24:32 24 minutes, 32 seconds growing from 70 to 100 next year some of this is just the base consumers buying more uh which is one way to grow and I 24:39 24 minutes, 39 seconds think payment gateway was a new part of the offering and when we grow obviously we'll have to keep doing all of these things just base clientele growing is is 24:46 24 minutes, 46 seconds very very organic and uh is just dependent upon what the market buys so we want to do both things in the base we 24:54 24 minutes, 54 seconds want to grab share in the new offering we want to have those strategic offerings which will lead to revenue growth I think that team has been able 25:01 25 minutes, 1 second to do both of these the interesting part is that in the next four to 5 years we are sure uh the way things are going that this non MF will be at least a 500 25:09 25 minutes, 9 seconds cr book for us in about 5 years if it continues to grow 40 to 50 cr a year and at that level at about a 30% eida it 25:16 25 minutes, 16 seconds should be a let's say 125 to 150 cr e aida range business it's heading that way it's heading that way and therefore We are very very hopeful that we'll be 25:23 25 minutes, 23 seconds able to deliver all of this. Uh those are broadly my answers to your questions. If there's any follow on you can let us know. 25:30 25 minutes, 30 seconds Yeah. Uh just one thing you know on the non MF business what is the current margin run rate and on the CAM space I just wanted to understand what is the mix of non MF clients and MF clients. 25:41 25 minutes, 41 seconds Thank you that's about it. Thank you. 25:44 25 minutes, 44 seconds Okay. The current margins we've seen some uh improvements happening over the quarters. You know a few years back we were sub 10%age. the current quarter 25:51 25 minutes, 51 seconds they are upwards of 13% ebita as a bucket and as I just like to reiterate what said in terms of the bucket is mixed it's got profit-making businesses 26:00 26 minutes and it's got also businesses are not making profit so but all put together they are kind of at a 13 plus percentage eida for the quarter in terms of cam's 26:09 26 minutes, 9 seconds pay uh earlier it was entirely dependent on mutual funds and now uh the dependence on mutual or the mutual fund 26:15 26 minutes, 15 seconds revenue is less than 50% of the overall Thank you. Thank you. 26:24 26 minutes, 24 seconds Thank you. A reminder, anyone who wishes to ask a question may press star and one on their touchstone telephone. 26:32 26 minutes, 32 seconds The next question comes from the line of Di Shagarwal from IFL Capital. Please go ahead. 26:40 26 minutes, 40 seconds Uh good morning everyone and thank you for the opportunity. Sir uh my first question would be on the MF uh could you 26:48 26 minutes, 48 seconds share if there are any major ANC's which are coming up for renewal over the next 18 months? 26:55 26 minutes, 55 seconds So uh Dish uh hi uh so as we have indicated in the past there are uh there are no major AMC's that are coming up 27:03 27 minutes, 3 seconds for a renewal in the current financial the upcoming financial year. uh there are a few mid-size AMCs who will come which are kind of due in the part of the 27:11 27 minutes, 11 seconds year but there are no major AMC's in the top five who are coming up for renewal in the current financial year and that's why in the six months been indicated they're looking at a broadly stable 27:19 27 minutes, 19 seconds yield regime for the next 18 months so u well every year there will be some EMCs that come for none of them are going to be the uh the bigger AMC's that we had a 27:28 27 minutes, 28 seconds renegotiation just a year or two back right sir and so secondly you recently won the mandate for uh Carandelian Mitan 27:38 27 minutes, 38 seconds uh could you just talk about how the competitive intensity is uh around the new around the basically for the winning 27:45 27 minutes, 45 seconds the new mandates uh how has been the competitive intensity is it coming down or is it still the same 27:52 27 minutes, 52 seconds uh the competitive intensity is still the same you know that in 24 28:00 28 minutes uh most of the mandates came to us uh after that I think we made it very clear to the marketplace that we are selling value. Uh we are selling premium value. 28:12 28 minutes, 12 seconds Uh a large part of the market which is inclined to pay that pay for that will obviously come to us. Carnelon is one example. Uh there are some bids where uh 28:22 28 minutes, 22 seconds price is perhaps the metric and any business you know there are bids where price is perhaps a metric. Uh you will 28:29 28 minutes, 29 seconds not find us chasing those deals. I think the operating part of the argument is that we want to sustain and expand 28:36 28 minutes, 36 seconds market share and AU and want to sustain and expand market share in the most profitable and the most revenue parts of 28:44 28 minutes, 44 seconds the overall stack. I think we've been able to successfully do that. Last calendar year you know that we took six 28:51 28 minutes, 51 seconds asset managers live which is a record for cams starting from uh angel broking to unify geob black truck choice taurus 28:59 28 minutes, 59 seconds which was a migration and then cank which is our only uh Sri Lanka client all of these went live so I think from a 29:07 29 minutes, 7 seconds operating sustenance and resilience perspective that's great news but again from a competitive intensity I think we will let competition do whatever they 29:14 29 minutes, 14 seconds choose is best for them but focusing on value and premium value to the customers I think remains our endeavor and that is 29:21 29 minutes, 21 seconds the way we will continue going right and uh what is the target for this year how many are we looking to take 29:29 29 minutes, 29 seconds live uh we now have four which are one uh which are yet not live so those four 29:38 29 minutes, 38 seconds have to go live in uh in financial year 26 I'm not counting the wins of 26 typically it takes sometimes six to 29:48 29 minutes, 48 seconds seven months at least and sometimes it takes about a year. So I think the four which we are carrying forward from the last year into this year and maybe the 29:55 29 minutes, 55 seconds two or three which we might win from now to June. So I will not be surprised if we take another five to six live this year 30:03 30 minutes, 3 seconds and any particular drag that you see on margins because of this 10 to 12 agencies which have gone live last year and this year combined for F27 margins. 30:13 30 minutes, 13 seconds actually uh I I will just uh talk about a few metrics which we haven't really positioned yet uh because till we are 30:21 30 minutes, 21 seconds 100% sure we want to expose it to all of you guys we will not do it. Um I think we've as a team done a fantastic job on 30:28 30 minutes, 28 seconds revenue per headcount and on overall headcount intensity of the business. If you clinically see headcount, headcount 30:35 30 minutes, 35 seconds has remained flat in calendar 25 which means the headcount we entered with and the headcount we exiting with is exactly 30:43 30 minutes, 43 seconds the same. Uh this is despite uh significantly expanded count of everything. So the automation and 30:51 30 minutes, 51 seconds productivity benefits we've just stated it as a line. I can convert into figures for you in a separate session. We didn't want to position it too hard right now. 30:58 30 minutes, 58 seconds I think that's been a great journey. All these six AMC's all the people who are employed there uh is all part of the base now is all part of the base this 31:07 31 minutes, 7 seconds year dish the way we see the overall technology interventions and the new uh platform capabilities although it'll be 31:15 31 minutes, 15 seconds module by module step by step we not going to anything in one stroke I expect these uh efficiencies to continue 31:22 31 minutes, 22 seconds growing so you will see uh that headcount expansion will be very muted revenue by headcount will be very large uh I mean the expansion will be large 31:30 31 minutes, 30 seconds and therefore all the cost and headcount related to taking new MC's live will remain in the base and will be managed well within the base. Just like to add 31:38 31 minutes, 38 seconds one thing is dish as you know the nature of the business is that the incremental cost will be mainly the manpower and uh this is true of every new AMC which is 31:46 31 minutes, 46 seconds the initial part of ramping up there will be some addition to the manpower but we just made it so efficient that you know uh the platform is catering to every new customer right so there'll be 31:55 31 minutes, 55 seconds some amount of customization but the major cost is only the 10 15 people that you're able to recruit additionally for that or in terms of transfer internally 32:02 32 minutes, 2 seconds in case there is a product improvements in other units so it's not a significant significant drag on the margins If anything when the revenue starts 32:09 32 minutes, 9 seconds coming on these when their AM start ramping up it could be a positive on the margins. 32:15 32 minutes, 15 seconds Right sir and sir one final one uh the cloud implementation that we were trying to do for our mutual fund operations uh 32:23 32 minutes, 23 seconds any update on that where are we in that journey so on that journey uh there are very 32:29 32 minutes, 29 seconds exciting developments on uh uh overall I'll just uh perhaps spend two minutes on this on the form data entry part 32:38 32 minutes, 38 seconds which is the uh the AI based data extraction I think we've done very well And we are moving a part of the payload. 32:47 32 minutes, 47 seconds You typically have a maker and a checker in every process. We are moving part of the maker payload uh completely into the 32:55 32 minutes, 55 seconds platform. It is underway as we speak. So you will see that happen completely in Jan Feb March. 33:02 33 minutes, 2 seconds on the compliance implementation you would have seen u you know the the press releases etc on camp's lens where we 33:11 33 minutes, 11 seconds have taken a lot of the compliance payload and compliance payload is basically uh reading of circulars and 33:19 33 minutes, 19 seconds documents issued by regulators interpreting them converting them into uh quizzes and tests into FAQs etc uh 33:27 33 minutes, 27 seconds that product is completely ready we announced this sometime in November is being used internally we'll open it up for the marketplace and again this is 33:35 33 minutes, 35 seconds built as a small language model on top of an existing uh LLM so that's uh 33:42 33 minutes, 42 seconds production ready now our uh our data lake and our uh you know data warehouse where we are moving things from the 33:51 33 minutes, 51 seconds on-prem Oracle to the Google cloud uh alloy and bigquery uh kind of setup uh that is underway too that may not happen by March that may happen in April Okay. 34:01 34 minutes, 1 second Uh but that part will happen and then there are uh several other exciting things. We had started building out a full module of uh you know uh 34:10 34 minutes, 10 seconds transaction acceptance. Uh that module uh will be also live or ready to go live in about April May. So there are 34:18 34 minutes, 18 seconds multiple uh things firing as I speak. Um there is a large team of engineers and of course people from our base business 34:26 34 minutes, 26 seconds were involved with this. So I'm uh quite happy. It's a very humongous program. It has multiple uh people, cultural, 34:34 34 minutes, 34 seconds partner, technology dimensions. Uh it involves work that we have not done in the past ever and rearchitecting 34:42 34 minutes, 42 seconds platforms, you know, it takes companies very long. We chose to go on a module by module approach. So that part is coming out very well. We will also cover this 34:50 34 minutes, 50 seconds in more detail in the analyst meet sometime in February. 34:55 34 minutes, 55 seconds Right sir, perfect. Thank you so much and all the very best. Thank you. Thank you. 35:02 35 minutes, 2 seconds Anyone who wishes to ask a question may press star N1 on their touchstone telephone. 35:08 35 minutes, 8 seconds The next question comes from the line of Deepangan Go from city. Please go ahead. 35:14 35 minutes, 14 seconds Uh hi sir, good morning. So uh few questions from my side. Uh first on the K business uh do you see any sort of 35:21 35 minutes, 21 seconds pricing uh regime change over the next few years? Um that was the first question. Uh second uh at the start of 35:29 35 minutes, 29 seconds the call you mentioned uh some number around 22 to 25 cr uh possible uh impact 35:37 35 minutes, 37 seconds due to the neutral service. Firstly did I understand it correctly and second um you know how do you arrive at this number and if you can kind of shade some 35:44 35 minutes, 44 seconds color on that. Uh and the third question is on the payments business. Uh obviously I mean that has been going at 35:52 35 minutes, 52 seconds a a very very good run rate. uh just wanted to understand you know in terms of new business horizons on the non- 35:59 35 minutes, 59 seconds mutual fund side is there uh either any inorganic activity or new uh uh you know cohorts where you would like to kind of 36:07 36 minutes, 7 seconds penetrate into sure uh so I'll take your questions in order on the K business uh you have seen 36:17 36 minutes, 17 seconds that uh there's been a den in the market not a real den but maybe a partial den that onboarding costs are high in the 36:24 36 minutes, 24 seconds industry Okay. Now uh for specific use cases and instances like the Chy SIP etc we had made sure that we offer to the 36:33 36 minutes, 33 seconds industry because we eat of the same plate we will never be predatory pricing uh technique people. Uh we had offered 36:40 36 minutes, 40 seconds fairly uh I mean rates which are aminable to the scale and size of that business. Uh for everything else I think 36:47 36 minutes, 47 seconds uh the rates across the market have been uh have been pretty stable. uh is there a conversation with the industry that 36:55 36 minutes, 55 seconds these prices will go down? You are reading the same statements that I'm reading. So obviously I will not say no that this topic does not exist. The 37:02 37 minutes, 2 seconds topic exists. Is that uh kind of an in the-face topic and do I have to deal with it today? Uh we will see. We will 37:10 37 minutes, 10 seconds see. I think the from a regulatory perspective the attempt always has been to make access easier and to sell things 37:18 37 minutes, 18 seconds cheaper and cheaper. I think from a K perspective for smaller formats for uh the smaller SIPs etc. very very friendly 37:26 37 minutes, 26 seconds rates already exist. So will this conversation which way this will head we will see and uh we watching it closely. 37:33 37 minutes, 33 seconds On your point number two I think uh this math hasn't been done by me. This math has been done by you guys. I've read it uh and I'm not either publicly endorsing 37:42 37 minutes, 42 seconds it or denying but uh the way this math kind of gets done is uh and I don't want to make it too complicated on the phone 37:51 37 minutes, 51 seconds that there is a a marginally positive part on some EMCs. It depends upon what PR you charge and what is the percentage 38:00 38 minutes split between uh your management fee and your expenses. But for some the GST advantages 38:07 38 minutes, 7 seconds offset the decreasion part and for some the exit load uh offsets the GST expansion the GST advantage. 38:16 38 minutes, 16 seconds So uh so I think the way this math was done was uh you know our fraction potential fraction uh people computed 38:25 38 minutes, 25 seconds and said that this is the sigma of all the potential contractions that can happen. Uh we've read the math uh we will see what conversations happen. Our 38:34 38 minutes, 34 seconds belief has always been that we deliver humongous sustained and expanding value to our clients. uh from a regulatory 38:43 38 minutes, 43 seconds controls product development perspective like I said just taking SIS live and the gift city offerings live has been very 38:51 38 minutes, 51 seconds very intense for us but we just charge base rates our clients are very appreciative of these things so the number is is is kind of a arithmetical 38:59 38 minutes, 59 seconds clinical number we will see what happens and uh we are watching the situation closely uh thirdly on the PAPG part I 39:06 39 minutes, 6 seconds think what you've asked is a very relevant question we have like I said we had two or years of breakaway k revenue growth. We've had sustained AIF growth 39:16 39 minutes, 16 seconds and we've had about 3 years of breakaway PAPG growth. Now the question is a valid question. It's a large market. Uh if I 39:24 39 minutes, 24 seconds take all payment enterprises and do a sigma of the revenue that is certainly 10,000 cr or more are assets available the answer is yes. However, it is not 39:33 39 minutes, 33 seconds seen as a very profitable business at scale. Uh it's not seen as a very profitable business. the UPI part which is still not charged and uh there are no 39:42 39 minutes, 42 seconds exact signs on when that will become chargeable. So while the stack in terms of offering swizzles towards UPI but UPI 39:49 39 minutes, 49 seconds is not chargeable isn't a great sign that investors want to see. So right now we will not do although we've looked at assets closely we always continue to 39:57 39 minutes, 57 seconds look at them. I think we believe that this is a part of our offering which we want to scale to an extent. Let's say uh if you get to about 90 to 100 cr next 40:05 40 minutes, 5 seconds year and maybe about 120 crores the year after we will pause and see what we want to do. Uh the profitability metric is important. So right now I think it's 40:13 40 minutes, 13 seconds unlikely that we will jump in and say some asset is uh you know the owners are selling therefore we want to buy in the area of payments till we believe that 40:21 40 minutes, 21 seconds this will align to the you know uh 30% or more uh aid margins that we aspire to achieve from it. 40:29 40 minutes, 29 seconds Got it. So just if I can squeeze in one small question. Um on the mutual fund side of the business, are there any asset managers where the renegotiation 40:37 40 minutes, 37 seconds or the uh you know pricing repricing kind of happens on an annual basis or everything is more like a two three five year contract. 40:45 40 minutes, 45 seconds Oh uh annual basis is not uh something that happens. It's generally three the punch and uh sometimes two and a half two if 40:52 40 minutes, 52 seconds there is some expectation of an event happening in the next couple of years. 40:56 40 minutes, 56 seconds But I think the average you should take it as a three-year period. uh annual generally doesn't happen. 41:01 41 minutes, 1 second Got it. So, uh thank you and all the best. Thank you. 41:08 41 minutes, 8 seconds A reminder, anyone who wishes to ask a question may press star and one on their touchstone telephone. 41:16 41 minutes, 16 seconds The next question comes from the line of Abiji from Kotak Securities. Please go ahead. 41:21 41 minutes, 21 seconds Hi, good morning everyone. Uh my first question was uh on the uh growth visibility revenue growth visibility on 41:30 41 minutes, 30 seconds the non mutual fund business. Uh now I recall uh you know that number being closer to 25%. 41:37 41 minutes, 37 seconds But there was a comment uh earlier that you know 20% uh is the number that looks more comfortable now. So just wanted to 41:44 41 minutes, 44 seconds you know double click on that. Uh first uh the second question was that uh you know the comment on uh cloud 41:51 41 minutes, 51 seconds implementation is is useful uh and how do we see that along with you know whatever is your best judgment on what 41:58 41 minutes, 58 seconds will happen to revenue yields um and how does that you know translate into a bit margins going forward do we still have 42:05 42 minutes, 5 seconds enough scope to extract uh you know margins given these implementations 42:12 42 minutes, 12 seconds uh thank you uh on the non-mutual fund growth. Uh there's two parts to it. Yes, the target is a 25% growth. I don't 42:20 42 minutes, 20 seconds think they're really looking at that, but I know you had a very subdued first quarter number in terms of non-mutual fund growth. So, I think what we are saying is we will get to that place. But 42:29 42 minutes, 29 seconds for the year, we have again record in the last couple of quarters to get it close to 25% and that is the long-term aim to get to 20%. But realistically, I think given that the first quarter was 42:36 42 minutes, 36 seconds where it was, I think to expect in the near term, a 20% uh cumulative growth is I think realistic. But however I think on a long-term basis even on a 42:44 42 minutes, 44 seconds medium-term basis we are aspiring and we are confident of getting a 25% growth right I think what we're talking about is near a year year from one year time frame from now where you should look at 42:52 42 minutes, 52 seconds between 20 and 25%. Um on the cloud implementation I think an so uh Abij on the cloud implementation I 43:00 43 minutes think um the the the only thing I will refer to is that 43:07 43 minutes, 7 seconds in the last 10 years and let this register in the last 10 years if I take out other business buildouts but I see 43:15 43 minutes, 15 seconds only MF we've engineered the entire expansion with almost constant headcount headcount 43:23 43 minutes, 23 seconds have grown 5%. While assets are 5x, transactions are over 5x. Storage requirements, record keeping 43:32 43 minutes, 32 seconds requirements, reconciliation, complaints, all of those numbers have grown, but we've kept the headcount constant. And therefore, automation in 43:40 43 minutes, 40 seconds the base in general has been a very uh remarkable success story. You can go back and check even in the process 43:48 43 minutes, 48 seconds industry if they've been able to do this and if there are companies which have done that. And I'm talking of a 2016 to 2025 time period. However, this is still working on the old platform. 44:01 44 minutes, 1 second We know that uh there are humongous benefits to be gained if we move platforms. Moving platforms is a painful 44:09 44 minutes, 9 seconds process because we don't want to buy anything. We build everything ourselves because that IP is what I sell for value that you see in the P&L. So, we are 44:18 44 minutes, 18 seconds building it now. I'll just give you an example. uh 300 cr emails are sent by us every year. A 44:25 44 minutes, 25 seconds cr a day. Each email is an artifact which can be disputed which does get disputed by intermediaries, customers, 44:33 44 minutes, 33 seconds all kinds of people. And therefore I reconcile 300 pro emails every year and that's just like a percent of the of a 44:42 44 minutes, 42 seconds percent of the work we do. But each part because anything can be referred to later. Uh do we do it most efficiently 44:49 44 minutes, 49 seconds today? The answer is no because the way it is engineered, it is not done efficiently. It has components of labor doing all of that. As we build the new 44:57 44 minutes, 57 seconds platform on technology which is developed in the last 3 4 5 years by some of the strongest names globally a 45:06 45 minutes, 6 seconds lot of these processes will become very very efficient instant nonbatch which means I will not 45:14 45 minutes, 14 seconds accumulate you know one lakh units to start the work. I can work instantly through APIs etc. So we expect a lot of efficiency to acrewue to the base and 45:23 45 minutes, 23 seconds when I said that despite all the expansion that has happened 1st January to 31st December we did not increase headcount at all in the company that's a 45:30 45 minutes, 30 seconds real statement. Now these efficiencies will go much farther but we we've been conservative in our style. It's very 45:39 45 minutes, 39 seconds easy for me to put a number and start publishing it to you guys and circulate it. We're not doing it now on a purpose. 45:44 45 minutes, 44 seconds One of course uh is the workforce angle because we do not want to uh publicly cover any contractions in workforce. We 45:53 45 minutes, 53 seconds will not do that. And second, we want to be 100% sure that on a year-on-year quarter quarter basis what uh advantages will acrue to investors under the 46:01 46 minutes, 1 second company and whether we can publish them or not. But I can tell you that the work for that started one and a half years ago in June July of 24. I personally 46:09 46 minutes, 9 seconds monitor these things so I know the detail that we are in a very good place right now. If you want specific answers, maybe 3 months from now, we should be in a position to give you a little more 46:17 46 minutes, 17 seconds specific. We may never uh declare exact margin correlation of the new platform. 46:23 46 minutes, 23 seconds I don't think we intend to do that, but you will see a lot of this in the P&L. That's where I will leave it. 46:29 46 minutes, 29 seconds Thank you. Thank you. 46:34 46 minutes, 34 seconds Thank you. The next question comes from the line of Sankit from Aendaspa. Please go ahead. 46:41 46 minutes, 41 seconds Um yeah, thanks. Thanks for the opportunity. Uh so I had one simple simple question that that delta improvement in the margins what we saw 46:49 46 minutes, 49 seconds in quarteron quarter basis is is predominantly driven by the uh non MF business um uh uh is it is or or if you 46:58 46 minutes, 58 seconds can give the delta change how much it contributed from the new initiative and new businesses and and and maybe MF in that sense. 47:06 47 minutes, 6 seconds So sankit uh uh the delta actually is do is predominantly because of the mutual fund business only uh the non-mutual 47:13 47 minutes, 13 seconds fund increase in margins was was there but it was not significant enough to make a more than 100 dips increase in margins I think that that level of margin did not happen non mutual 47:22 47 minutes, 22 seconds predominantly it is because of the mutual fund business and if you see also driven by the rationalization in the manpower cost is that we do not have any 47:29 47 minutes, 29 seconds increase in the manpower cost in spite of a labor code charge I think quarteron quarter my my manpower cost is is stable 47:37 47 minutes, 37 seconds is static. In fact, there's no increase at all. That's minor increase. So, it is driven only by the core business. A very small part of it is because of the nonp. 47:45 47 minutes, 45 seconds Uh understood. And and and uh and and you mentioned that your your blended margin is 13%age for the nonf part. Um 47:55 47 minutes, 55 seconds uh say say maybe maybe given given it has improved by 300 basis point uh on year-on-year basis if I understood right. uh then then then is it fair to 48:04 48 minutes, 4 seconds say that a similar delta can happen in this line of business in in a year or two uh in that sense given given a 48:12 48 minutes, 12 seconds couple of businesses or pure platforms so uh the 10% reference rate was not last year it was probably two and a half three years back when we started 48:20 48 minutes, 20 seconds tracking this very closely as a separate bucket uh on a year-on-year basis I think the margin increase will be close to 100 bips only it's not it's not uh 48:28 48 minutes, 28 seconds know 300 bips in terms of non-mutual fund business but just going forward we do expect once we start adding more revenue to to the top line as Anoj 48:36 48 minutes, 36 seconds mentioned these are all platform based businesses there could be a replication of this you know in terms of every year uh and you know for us to get to in 3 48:44 48 minutes, 44 seconds years time to a consolidated 20%age EIA is I think the base you know we should be something more than that but at least to get there within the next 3 years 48:51 48 minutes, 51 seconds which means that as we add keep adding revenue the increase in margins will be significant so we hope to get to this 20% IATA margin within the next 3 years 48:59 48 minutes, 59 seconds for the non-mutual function Uh okay. Uh okay. So so basically basically a a 700 basis point 49:07 49 minutes, 7 seconds improvement in in the non non MF business in in three-year period is is is is possible from from the current levels. It is absolutely possible. Yes. 49:15 49 minutes, 15 seconds Understood. Understood. And and lastly given given so many mutual funds have got onboarded in in last couple of years 49:22 49 minutes, 22 seconds um uh this this people count control is is is sustainable or or you think uh ultimately somewhere we need to start 49:30 49 minutes, 30 seconds adding people to to to to cater to to to the requirements in in that sense uh you you will see that we just 49:39 49 minutes, 39 seconds inserted one line on technology based productivity. So while all these new MFS need teams, our philosophy has been 49:48 49 minutes, 48 seconds dedicated headcount fenced areas for every new client. We don't give them any shared facility to the extent possible. 49:54 49 minutes, 54 seconds All that has happened, I think all these additions have been offset by efficiencies that we've created in other places. Some led by the new platform, 50:02 50 minutes, 2 seconds some led by past, you know, innovations in technology in the base stack itself. 50:08 50 minutes, 8 seconds So that will continue. That will continue. you will only see it gaining more momentum. It will not slow down. I think it's a four five year journey from now where you will continue seeing these efficiencies play out. 50:18 50 minutes, 18 seconds Uh so so an uh is it fair to say that uh with no significant man count addition with productivity gains uh you can still 50:27 50 minutes, 27 seconds cater to to to to the new newer funds even if you have a dedicated team to the newer funds. 50:34 50 minutes, 34 seconds Yeah. Yes. The last full year was vindication of this. Just look at the last four years. We've stated in public that we've taken these six clients and 50:41 50 minutes, 41 seconds the SIFS live. Uh the net headcount is flat to lower like Ram said uh those are the real figures. 50:50 50 minutes, 50 seconds Uh so so so in in simple words then then uh uh with with no people addition uh is it fair to say that a pure pure MF 50:57 50 minutes, 57 seconds business uh not considering the new new non MF business uh there is a scope assume yield pressure doesn't come 51:05 51 minutes, 5 seconds because of the TR or something of that kind uh then then is it fair to say that uh this productivity gains itself will 51:12 51 minutes, 12 seconds can expand your margins by maybe maybe another 100 200 basis points in couple of years. 51:19 51 minutes, 19 seconds Uh so just like to uh say a couple of points there one is that while there is no headcount increase there will be an remuneration increase which is your 51:26 51 minutes, 26 seconds increments and annual increments will happen. So it's not as if the labor cost is going to remain same. So there will be some cost pressure because you know that you know every year there has to be 51:34 51 minutes, 34 seconds an appraisal that goes to the employees in a good year it's probably more than 10% and bad year is probably 7 8%. So that's a cost that will come in. uh but 51:42 51 minutes, 42 seconds as we say even if there's moderate yield pressure and even if there's an impact on the salary cost and given the technology investments that we continue 51:49 51 minutes, 49 seconds to make and the hiring which continue to do for the platform uh to expect the 100 bits creep up in margins over the next year or two is something that is on the 51:57 51 minutes, 57 seconds cards but again uh there are several moving parts to this uh we would stick to our revenue uh to our margin guidance to say that we will be more than 45% we 52:05 52 minutes, 5 seconds will creep up to 46 and 47 in good quarters but to predict anything more than that we'll be a little premature No. 52:12 52 minutes, 12 seconds Uh, understood. Uh, this this is very clear. Uh, thanks thanks for the answers. 52:18 52 minutes, 18 seconds Thank you. Anyone who wishes to ask a question may press star and one on the touchstone telephone. 52:26 52 minutes, 26 seconds The next question comes from the line of sukrit de battle from eyesight trade private limited. Please go ahead. 52:33 52 minutes, 33 seconds Uh, good morning to the team. Uh, I have two questions. My first question to Mr. 52:37 52 minutes, 37 seconds Anujit. Uh as CAM expand beyond its core mutual fund service into insurance, fintech and digital platforms, how do 52:44 52 minutes, 44 seconds you see the revenue mix evolving over the next two to three years? And what strategic priorities whether in technology, innovation, partnerships or 52:53 52 minutes, 53 seconds customer engagement will be most critical to ensure CAMS maintain the backbone of India's financial ecosystem. 53:00 53 minutes That's my first question. I'll ask my second question after. Thank you. 53:05 53 minutes, 5 seconds So um again uh the the only thing I'll point your attention to is that consistently over the past six years since we started facing the market uh 53:14 53 minutes, 14 seconds there's been no change in opposition on any of the things you've asked. Uh and that covers most topics. Uh we don't want to be an overdiversified company. 53:23 53 minutes, 23 seconds It's not our attempt. I think investors pay value for the kind of business they like and we don't want to make it a mishmash. We publicly stated we'd like 53:30 53 minutes, 30 seconds to get to about 20% of revenue contribution from nonMF. We are steadfastly chasing that as a goal. If 53:38 53 minutes, 38 seconds we are able to expand uh revenue by about 150 to 200 cr every year in the next 3 years, we will be a 2,000 cr 53:45 53 minutes, 45 seconds company soon. Let's say in 3 years or 2 and a half years at that time 20% of non MF is 400 cr. We would like to get there 53:54 53 minutes, 54 seconds in MF. I think uh if you've just seen our leadership and uh obviously some of you do attend the annual uh you know the 54:03 54 minutes, 3 seconds meet we do for analysts you would have seen that not just the top level leadership but people beyond and people 54:10 54 minutes, 10 seconds beyond we have made significant investments none of this is lip service none of this is showing you the mugsh shot of people who don't work for us all 54:19 54 minutes, 19 seconds of this is clearly uh rupee value that we are delivering uh to the marketplace if you ask me one single investment that 54:26 54 minutes, 26 seconds I've made in my time it is this today we have uh literally between 50 to 100 engineers sourced from the IITs 54:35 54 minutes, 35 seconds and if I include the IM and the NIT and some of the tier one institutes this number will be about 150 which we acquired in the last two and a half 54:42 54 minutes, 42 seconds years 3 years to build out the platform be part of operations be part of product etc. So that that remains we will not 54:49 54 minutes, 49 seconds become over diversified. We will not make acquisitions just to make the top line look nicer. So our stated uh 54:57 54 minutes, 57 seconds commitment to the domestic market and despite all the temptations you would have seen that we've been saying this consistently that till the domestic 55:04 55 minutes, 4 seconds market uh worries us in some form. We are committed to the domestic market. 55:08 55 minutes, 8 seconds This is the arena we are playing in within the domestic market 80% of our revenue should come from MFS uh and related uh you know market segments. we 55:16 55 minutes, 16 seconds will remain there. Now the balance part when it becomes 4 or 500 cr needs his own attention uh for insurance companies 55:24 55 minutes, 24 seconds for example uh we relate with the regulators and the top insurance companies same for payments uh those two 55:31 55 minutes, 31 seconds certainly uh to an extent uh Aif and K although Aif is a very splintered business uh there are not 60 but 55:39 55 minutes, 39 seconds thousands of them so cost of sales etc increases for every product class therefore I think the dynamics are 55:46 55 minutes, 46 seconds different. Mutual fund is concentrated business. The rest of them don't have concentration. They are splintered businesses and therefore cost of sales 55:54 55 minutes, 54 seconds uh will be high. Cost of product can be high where we are competing with the fintex and the startups which is like the account aggregator business. I don't 56:02 56 minutes, 2 seconds think I have a single answer for your question. All I will say is that in the last 10 years we've been able to kind of stitch this strategy which plays well to 56:10 56 minutes, 10 seconds the market to gain acceptance to be the number one or number two player in every segment we are in. And today you will see that at 68% market share we are the 56:19 56 minutes, 19 seconds number one player in MFRA at 50% market share we are the number one player in alternative outsourcing. At 40% market share we are either number one or number 56:28 56 minutes, 28 seconds two in insurance repository. At close to 20% we are the number two in K. So these are the positions we are aspiring for. 56:35 56 minutes, 35 seconds Can I get there for every business? The answer is no. We'll be very happy if we have one core business which is kind of 56:43 56 minutes, 43 seconds firing on all cylinders and we have three other businesses which are firing on all cylinders. You don't have companies which have six or seven leadership businesses. Very tough to get 56:50 56 minutes, 50 seconds there. The the rules of concentration apply to all of us, right? You can't be an athlete doing free sports. So we're cognizant of that. But that perhaps 56:59 56 minutes, 59 seconds answers your question. Anything else that you need? Maybe we can have a separate dialogue. 57:04 57 minutes, 4 seconds Fair enough. My second question is to Mr. Ram Ram Chan. Uh with CAM consistently delivering strong margins, 57:11 57 minutes, 11 seconds how are you planning to sustain profitability while funding growth in your businesses? Looking ahead, what is your framework for balancing operating 57:19 57 minutes, 19 seconds leverage, disciplined capital allocation and digital cost efficiency to drive ROE and long-term sustainability? Thank you. 57:30 57 minutes, 30 seconds Oh, sure. Um as you know that you know the business that we operate in offers uh some amount of operating leverage to us. Uh well there is there's always puts 57:38 57 minutes, 38 seconds and takes right. So from a margin perspective there is always the pressure that you had on the employee cost. There is the yield pressure that you that is abated now but still is there to some 57:46 57 minutes, 46 seconds extent and then there is the entire technology investments and regulatory pressures that you need to keep investing. Uh so this is offset by what we do in the productivity enhancements 57:54 57 minutes, 54 seconds and technology etc. So it's a constant kind of puts and takes between both and we have managed to uh get a balance between the two and have seen that you 58:03 58 minutes, 3 seconds know in fact post listing we've been able to increase our margins by 100 bits a year at least you know and uh now that we at a steady state of between 45 and 58:10 58 minutes, 10 seconds 46%age at any point at any point of this journey we've never optimized on our investments in technology we investments 58:17 58 minutes, 17 seconds investments in non-mutual fund businesses we have built out several products and platforms uh we are cognizant of the fact that these could be the you know one of these could be a 58:26 58 minutes, 26 seconds breakout revenue opportunity for us in the future also. So we've never optimized on the investments as such. 58:31 58 minutes, 31 seconds Even in quarters where the margins were 42 43 percentage we did not optimize on investments. We continue to build the products. We have released several such 58:39 58 minutes, 39 seconds products in terms of afer account aggregator product the pension product and even the several enhancements has happened from a mutual fund perspective. So I think the future 58:47 58 minutes, 47 seconds is uh secured from that perspective is we've invested for the future we invested on technology. we have get an optimal uh optimal look at the cost so 58:55 58 minutes, 55 seconds that they don't kind of run away in terms of the operating cost at the same time we have enough of operating leverage to cover the yield depletion so I think we are in a good place from a 59:02 59 minutes, 2 seconds margin perspective and going forward we don't see much of a pressure on this also thank you for the guidance and I wish 59:11 59 minutes, 11 seconds the entire team best of luck for the next quarter thank you the next question comes from the line of 59:19 59 minutes, 19 seconds Prias Jen from Motilos please go ahead Yeah. Hi, hi everyone out there and good set of numbers. Uh uh Anoj the first is 59:28 59 minutes, 28 seconds a bit of a structural question as to you know there are a lot of new MS again getting licenses to open up and more are 59:36 59 minutes, 36 seconds in the pipeline more people wanting to open mutual funds. So how is the landscape now in terms of the 59:44 59 minutes, 44 seconds competitive intensity in acquiring new uh new AMC's into the fold 59:52 59 minutes, 52 seconds so you know so could if you could throw some light there you know because I think in the past few years there has been a high degree of competitive 59:59 59 minutes, 59 seconds intensity uh to acquire acquire the new AMC's so what is the kind of intensity right now that you're seeing 1:00:09 1 hour, 9 seconds uh so like we And uh you know there there were two kinds of people who wanted to get into mutual funds. Uh 1:00:16 1 hour, 16 seconds there were the broking companies and there were the BMS and AF players. It it continues to remain uh in those two 1:00:24 1 hour, 24 seconds boxes. Uh most of the new applicants are in either the first or the second box despite the increased network 1:00:32 1 hour, 32 seconds requirements etc. There is obviously uh a trend to give a lot more licenses and make this uh you know a less concentrated industry than it has been. 1:00:43 1 hour, 43 seconds Uh that is uh perhaps at a policy level the thought process. 1:00:47 1 hour, 47 seconds uh we've been clear like I said at the beginning of this call that we are selling value uh to our customers both 1:00:55 1 hour, 55 seconds existing and new ones and therefore there are logos that we want and we go completely after them and then uh there 1:01:03 1 hour, 1 minute, 3 seconds could be uh there will always be like I said in every market not just this market where people uh want to buy the 1:01:10 1 hour, 1 minute, 10 seconds lowest price uh for either constraints or or just the approach towards buying uh we are show whether we want to be 1:01:18 1 hour, 1 minute, 18 seconds part of each one of those bids. Uh last one year for example we took uh six AMC's live. Some of the new AMC's which 1:01:25 1 hour, 1 minute, 25 seconds we took live in N23 and 24 will head towards a 10,000 cr soon. Uh one of them 1:01:32 1 hour, 1 minute, 32 seconds has already headed towards 10,000. So some of them are making good progress. 1:01:36 1 hour, 1 minute, 36 seconds Uh but we are selling value. Uh we don't want to be a competing on price going to the bottom of the barrel or scraping the bottom. 1:01:46 1 hour, 1 minute, 46 seconds uh we we we will deliver sustained value. So we expect new AMC's to come in like I said uh six of them went live last year. Four were new domestic logos. 1:01:55 1 hour, 1 minute, 55 seconds One was a domestic transition. One was a Sri Lankan logo. That [snorts] leaves four one logos to be taken live in 26 which will be taken live by us 1:02:03 1 hour, 2 minutes, 3 seconds definitely within 26 I think. Uh some of the new wins which happen from now up to June will also be eligible uh to go live 1:02:11 1 hour, 2 minutes, 11 seconds in 26. So I think it'll be about five to six go lives which I think is a very good number for us to kind of ensure that uh we are doing justice to our 1:02:20 1 hour, 2 minutes, 20 seconds clients. Uh we giving them highquality operating environments uh strong talent and and clients obviously who appreciate the value that camps brings to the 1:02:28 1 hour, 2 minutes, 28 seconds table. So that's been the approach so far. 1:02:31 1 hour, 2 minutes, 31 seconds Got that. And secondly on the struct again structural bit uh do you think that uh the RTA industry at any point in 1:02:41 1 hour, 2 minutes, 41 seconds future say like next 3 four years uh could move to a fixed pricing mechanism rather than a percentage of AUM basis. 1:02:49 1 hour, 2 minutes, 49 seconds Do you think that is a better approach? 1:02:53 1 hour, 2 minutes, 53 seconds Well, uh I I'll give you the honest answer that if I had a fixed cost or price per portfolio, 1:03:00 1 hour, 3 minutes a fixed price per transaction, a fixed price for any activity, I would perhaps end up making more money than I make today. 1:03:09 1 hour, 3 minutes, 9 seconds Okay. 1:03:10 1 hour, 3 minutes, 10 seconds Our price for portfolio has been dipping almost every year for the last 10 years. 1:03:15 1 hour, 3 minutes, 15 seconds A price for transaction has been dipping every year for the last eight or nine years. So it's just that it's a more uncertain regime than the regime today. 1:03:26 1 hour, 3 minutes, 26 seconds We've been used to a certain regime and used to managing cost and profit uh in a certain regime. Uh it will be a humongous change to implement something 1:03:35 1 hour, 3 minutes, 35 seconds like that. The change requests will have to be priced. A lot of administrative and pricing work and scoping work will come in which I don't think we as an 1:03:42 1 hour, 3 minutes, 42 seconds industry are ready for. So we are happy with the way things are happening and we are happy the entire retailization. 1:03:49 1 hour, 3 minutes, 49 seconds uh we gave you a number of camps registering 1.2 2 cr SIPs in a quarter. 10 or 11 1:03:57 1 hour, 3 minutes, 57 seconds years back this number used to be less than 110th. Right? No, my revenue has not grown 10 times. Uh I could have charged cost per SIP registration and we 1:04:06 1 hour, 4 minutes, 6 seconds would have been a richer company. But all of that is meant for other people. I think we're quite happy with the pricing. So are our clients. And I don't 1:04:13 1 hour, 4 minutes, 13 seconds think any dramatic shifts in optimizing it for either side, either the buyer or seller under the way right now. 1:04:20 1 hour, 4 minutes, 20 seconds Got it. Uh just some bookkeeping questions on the employee cost there has been flattish trajectory or marginary 1:04:27 1 hour, 4 minutes, 27 seconds decline in fact uh sequentially uh Ram anything on the on the new labor law that the impact has yet to be taken or anything on that sort. 1:04:38 1 hour, 4 minutes, 38 seconds So pre uh so uh as you know that you know labor law was uh notified on 21st of November and I think there are some 1:04:46 1 hour, 4 minutes, 46 seconds rules that are yet to be notified which is expected to be April 1st. There are four broad limbs to it. People are talking about a graduity impact, a possible ESI impact, a possible proud 1:04:54 1 hour, 4 minutes, 54 seconds and fund impact and possible leaving catchment impact. In our assessment, the biggest impact will be the graduity impact. Others could be minor if if any. 1:05:02 1 hour, 5 minutes, 2 seconds Uh so and we have taken the full impact of the graduity. Uh so we have done an actual valuation and hence uh I think going forward from a labor code perspective, we do not expect a significant cost to come to the books. 1:05:13 1 hour, 5 minutes, 13 seconds Uh I think that has been fully provided for in the current quarter. 1:05:17 1 hour, 5 minutes, 17 seconds Right. And last bit on the seasonality in camps pay like the fourth quarter of FI25 we had seen a very sharp jump uh 1:05:25 1 hour, 5 minutes, 25 seconds from about 11 crores to about 16 crores revenue uh that's uh because camps pay is is a part of insurance as well uh we 1:05:35 1 hour, 5 minutes, 35 seconds should expect something similar is that the right way to think about seasonality in camps pay it is true that there will be an uptick 1:05:42 1 hour, 5 minutes, 42 seconds in the revenue in Q4 PR that is expected however you know we are trying to normalize things so that we don't see a big dip in Q1. Also, there are enough uh 1:05:51 1 hour, 5 minutes, 51 seconds you know enough efforts underway to broadbase the client base to ensure that doesn't happen. But to your limited question of whether there's going to be a spike in Q4, we do expect Q4 revenue to grow over Q3 revenue. 1:06:02 1 hour, 6 minutes, 2 seconds Got that. Thank you so much and wish you all the best. Thank you. 1:06:09 1 hour, 6 minutes, 9 seconds We'll take this as our last question for today. I now hand the conference over to Mr. Ramcharan for closing comments. 1:06:17 1 hour, 6 minutes, 17 seconds Thank you and thank you to all the participants uh for your participation and spending time on camps. Uh as always if you have any queries please please 1:06:24 1 hour, 6 minutes, 24 seconds feel free to reach out to Anish Auto to Orient Capital. I'll be happy to take your meetings and questions. Thank you. 1:06:32 1 hour, 6 minutes, 32 seconds On behalf of MG that conclude this conference. Thank you for joining us.