Ladies and gentlemen, good day and welcome to the Computer Age Management Services Q4 and FY 2026 earnings conference call. As a reminder, all participant line will be on the listen-only mode, and there will be an opportunity for you to ask question after the presentation conclude. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nikunj Seth from MUFG. Thank you, and over to you, sir.
Thank you, Danish. Good morning, everyone. Welcome to Q4 and FY 2026 earnings conference call of Computer Age Management Services Limited. From the management, we have with us Mr. Anuj Kumar, MD and CEO; Mr. Ram Charan, CFO; and Mr. Anish Sawlani, Head Investor Relations. Before we proceed to the opening remarks, I would like to give a small disclaimer that this conference may contain certain forward-looking statements about the company, which are based on beliefs, opinions, and expectations of the company as on date. These statements are no guarantees of future performance and involve risk and uncertainty. A detailed disclaimer has been published in the investor presentation. Now I would like to hand over the conference to Mr. Anuj Kumar for his opening remarks. Thank you.
Nikunj, hi. Thank you very much. Good morning to everyone. Appreciate all of you taking the time out to join our earnings call. As you would have seen the results that we published yesterday, it's been a pretty solid quarter for CAMS in 4Q of FY 2026. You know that the external environment has not exactly been friendly. In the months of January and February, those I would classify as normal months. In the month of March, of course, there was significant impact from what was happening in the environment. Despite all of that, you've seen our results, and I'm very happy to kind of share with you a set of events which I would say are pretty interconnected, but their reflection is in the quarter that just went past.
The foundational impact of a lot of things which are happening will continue to be seen, I'm sure, in this year and perhaps the next. Just to sum all of this up, you've seen the decks. I'm assuming that you've gone through it at least once. We posted our highest ever quarterly revenue in Q4 2026. For the first time, I think I am calling out the non-MF performance ahead of MF because non-MF kind of heralded the growth metric a lot better than MF did in this quarter. We grew non-MF revenue close to 25% year-on-year. You know our promise has been 20%. Successively over the last three years, we've been able to beat that, and we expect that we have the mix of products and go-to-market strategy to continue doing this.
Enterprise revenue for the quarter went up, 11%. I mean, quarter-on-quarter it was 1.3%. You know, the reasons. Annually, it went up, 11% year-on-year. The MF business revenue was almost flat. It just grew about 0.5%. Given the circumstances, it wasn't bad at all. MF yields held quite well. With all the operational efficiency, automation, the new platform program, what we call the re-architecture program, everything contributed their bit. Obviously, you know that there is a significant degree of fiscal discipline in the company. Absolute EBITDA scaled back to the highest ever. Now, I will take you back to 4Q last year, January, February, when you know that we had done price adjustment, et cetera.
That is almost an event which is completely behind us. From a peak of about INR 173 crore, INR 174 crore of absolute EBITDA, we went to about INR 177 last quarter. We've climbed up to about INR 183 now. I expect that this is kind of a baseline number which will stick. Percentage EBITDA climbed back to just in excess of 46%, about 46.5%. As a collectivity, I think that's a great set of metrics to have on our side. From mutual fund business perspective, AUM at INR 55.1 crore is obviously significantly lower than the INR 58.5 that we achieved at some time in 4Q. Because of the impact of what's happening in the Middle East, it came down.
However, this represents 21% year-on-year growth and holding 68% overall share. Share is a great story on equity assets. I think overall, we are holding 68%. We grew AUM in line with the industry at 21%. Equity assets, within all this, within the turmoil, went up to the highest ever of INR 30.5 lakh crore, with a share of 67%. This is almost a 90 bps . I would approximate it to about 1%. Went up about from 66% to 67% year-on-year. Certainly grew faster than the industry, which is a great sign. Equity net sales, which I think is the most formative metric here because of all the puts and takes.
This is the real money which comes and hits the books, which was in just in excess of INR 1 lakh crore. Within equity net sales, therefore, our share grew from 71% in the past quarter to 76%. These are great numbers. Historically, if I take you back four or five years, CAMS used to be about 60% share of the active equity market and about 80% share of the fixed income market. This was before passives, et cetera, became popular. It was largely five years back, it was largely an actively managed market, 60% in equity, about 80% in fixed income. That 60% gradually has climbed up to the number that you're seeing, which is about 67%.
About, I think, about 1% a year. Given the fact that this is the most retailized, the most sticky, the most remunerative, the most growth-oriented component of the overall market, it certainly is formative. It's not a flash in the pan. It's nothing that happened in one quarter or two quarters and will then go away because we believe the foundational components just remain intact. New SIP registrations aided all of this. They aid AUM, they aid equity AUM, and they aid net sales. New SIP registrations went up to about INR 1.26 crore. Our typical baseline number is about INR 1 crore-INR 1.1 crore in a quarter. This was a significantly higher number than Q4 last year. Grew about 46%. Industry grew 37%.
Another metric after metric in the top 4 or 5 metrics that really matter, again, from a foundational perspective, not just a quarterly performance perspective, I think we outpaced the industry by some margin. Annual SIP registrations hit just short of INR 5 crore, about INR 4.7 crore, up 17% over FY 2025, and this number is almost 2x of the industry growth. Across, across all of these that I've spoken about, significantly or a little bit ahead of the industry. SIP collections crossed the INR 20,000 crore milestone in the month of March. Grew 25% year-on-year and almost touched INR 59,000 crore for the quarter. And this is about 17% up year-on-year, compared to 4% for the industry. Overall, share of these collections went up from 57% to 64%.
Unique investor base, similarly, you can see the number, again, outpaced the industry. From a new logo perspective, you're aware that our philosophy has been that, of course, it's very encouraging to see in the environment that a large number of new AMCs are getting licensed. We have said that, traditionally, for the last three decades, our franchise was built on a scale play, a bit of a brand play and a scale play. Therefore, our endeavor is to go after logos that we believe are great fits into the scale play. Both the names that I mentioned, Neo and Oaklane, conform to that. We believe that our strategy of selling value, selling just incremental consumer value and AMC value, instead of selling price, has succeeded over a period of time.
The total count of AMCs, this is, of course, licensed AMCs, not everybody is live yet. These are licensed domestic AMCs, adds up to 31. Transaction volumes continue to scale. They have continued to scale because that is the retailization penetration metric that everybody talks about. Grew about 20%, reached INR 107 crore financial transactions. There's a bit of about INR 2 crore-INR 2.5 crore non-financial transactions too on top of this, but this is the core financial transaction. SIFs, which was a product category announced somewhere early in 2025, went live in September, October of 2025. Four new SIFs launched during the quarter. Total number of live SIFs is now 6.
We have about 8 which are either licensed from a product perspective-- 8 traditional, you know, which are either licensed from a product perspective or have made announcements and will get licensed soon. You will see these launches. I suspect the launches will happen between maybe in July, August or maybe even faster, but certainly within those 4 months. This will become a very relevant competitive new product category for the industry and for us. Very sanguine about the prospects. Retail fund launches in GIFT City, I know that it isn't a great AUM story yet, but it's a compelling story for domestic investors wanting to invest in outside assets and not feel the constraints of going through, you know, the ETFs, et cetera, some of which have run into a ceiling.
This continued. When I move beyond MF, when I move beyond MF to non-MF, I think contribution to enterprise revenue obviously could have been better. We certainly want to scale it even faster, but at 15.3%, it's kind of underscoring all the diversification that we've tried to do in a very focused manner in the last 4 years. Within this, Pay, which is now a licensed PA and a PG both, delivered about 23% growth year-on-year, continued to add new clients, and continued to do payment gateway and scale payment gateway, which is the additional offering. Alternatives, although you know that not every AIF which has got a license is launched, quite a few of them have been licensed but haven't launched yet or have been deferring launches.
We had a very strong quarter. Revenue grew over 25% year-on-year. AUM crossed INR 3 lakh crore. The 50% share of the outsource market remained intact. The number of mandates, you know, these are like full service mandates, 44 new ones, 14 new logos, almost 1 a week or faster than that. KRA, where you know that the business has gone through several moments of reckoning in the last 1 year, not 1 moment of reckoning, and that's not just a story about us, across the industry, as investors have rethought their strategy on participating directly in the equity market through their demat accounts and broking accounts.
Also some of the geopolitical stuff would have had its impact on new folio opening, et cetera. Despite all of that, and despite the fact that now, of course, you've seen that the KRA business will take a bit of revenue down because of the price drop. Despite those several moments of reckoning within one year, there's a 28% year-on-year revenue growth for the quarter. Like we had said that our base is mutual funds. Our additional arena is brokerages and DPs. Within that, we added a couple of fairly active large accounts, and we believe that this trend is there to continue. We will continue gaining share.
The integration of NSE KRA, which was a slump sale, done by them and acquired by us in the month of January, brought in about INR 13 lakh, INR 14 lakh new PANs. It was a very clean integration. You did not hear a single hiccup. You did not hear a single service issue or anything on social media. That part is in the base now. Delivered a 6% year-on-year revenue growth for the quarter. Bima Central, I think, did well, doubled its active user base. LIC started policy issuance in the Demat format, largely digital origination. It was signed in last March in 25. Took about up to February, March to get integrated.
We're expecting that that will at some point, and at some point should be within this year, add a new dimension to how the insurance industry looks at insurance Demat. As LIC scales, a lot of the other ones who've been convinced about Demat issuance and service will jump into the fray. Again, a formative metric. We've said this for some time. We'll wait for some decisive definitive action before we thumb the table, but I think it's my duty to mention this to you. IR market share expanded to 40%. Again, just to sum it up, 68%, said this many times in the past, 68% market share in MF, 40% in IR, 50% in the outsource part of KRA of AIFs.
KRA now decisively the number 2 player, leapfrog from being number 3 about a year and a half back to number 2. All of that has held together. The last thing I would mention is that as this DPDP bill, whose rules have now been notified, the date for adherence and compliance has been declared as first of May next year, although the board is in the process of getting set up. I think there is a lot of inquiry inside the markets. I would say right now inside the financial services market, not as much in hospitality and airlines and retail and food delivery, et cetera, but all of that will happen.
Since we believe that we will have certainly a processor status in several segments of our business, and in one or more, including KRA, repository, and RTA, we could be a fiduciary. Largely, it was a captive offering, both from a data discovery and a consenting part, you know that we know consenting well because that's a very fairly evolved practice in MF in both MFCentral and in account aggregator. Largely NA. We decided to launch this commercial offering called ConsenPro , which kind of delivers the end outcomes in as far as DPDP compliance is concerned. We're expecting that this market will undergo a lot of decisive action in the coming quarters as the date for compliance gets closer and closer.
We're still about a year away, and that's how the action is just beginning to unfold. We saw this opportunity. We'll keep you posted on how this goes. The last thing that I decided to cover, there have been questions across the board from all of us and all of you rightfully so, on what is the behavior and what is the progress on the re-architecture program. Are we on course? How's the Google relationship doing? I think finally everyone wants to know that why are you dropping less or dropping more of these words of, you know, GPUs and artificial intelligence and self-learning algorithms and everything which is being said around us in the marketplace. Very happy to share with you just one metric that you would have seen us grow revenue on almost a flat headcount.
You know that we've never historically been a company which does, you know, frequent headcount resets. We actually haven't done it in recent times, including during the COVID era, et cetera. On a flat headcount, which means we are doing nothing to the headcount, but we are just getting the productivity up through a series of automation steps. I think that is something you would have seen in the last year. I saw it in the last quarter. Our belief is that in FY 2027, we will see all the revenue growth on falling headcount, somewhat a fall, which means we may choose not to do some backfill.
Some backfill obviously we'll have to do, but if we choose not to do some of it, that I think will be a significant improvement in terms of employee productivity and revenue productivity per employee. What are the key capabilities? Our, one of the steps we had taken was, you know, this entire thing about, you know that we've done great stuff in face reading and video reading and face match, et cetera, and we're the only ones who do that 10-minute KYC. We extend all of this to form reading. We are now almost taking out the maker step in a lot of physical forms, which means, you know, we still retain the physical checker, so there is a human.
The other human we are taking out and letting the machine do that work. This went on for in production, now in actual production, no beta, no testing, for over a month, now almost two months, and we will continue to deepen this over a period of time. So that delivers some degree of operational efficiency, but some other capabilities that you will see now, you will see data lake and transaction origination platform. These are large platforms where building and testing it is one part and then taking it to market because everybody integrates, which means all of them have to do a bit of integration work at their side. I think that is beginning to happen. Where will you see the impact?
You will see the impact in a significantly lower percentage of industry complaints, when you see 1.5x or 2x transaction base. Complaints per transaction as a metric is significantly ahead of the industry. You will see and hear from the marketplace and from our clients about the next-gen transaction origination platform. Of course, taking it to market and making sure that we sunset the old one and get the new one in place will take some time, but we are ready, completely ready. The data warehouse is ready to go, both of these within the next three or four months. They are technically ready and waiting for a rollout. These, and then there are several other things which obviously whenever we meet you one-on-one, we will talk about those.
Where will you see the benefits? I have told you the benefits, that this is not just some technical jargon or something hidden in, you know, five layers of technical detail. It's obvious metrics. You will see headcount, you will see revenue by headcount, you will see complaints, you will see, you know, lowering of the complaints on transaction ratio, you will see fewer frauds. You will see fewer risk items, charges taken to the P&L basis, risk incidents, et cetera. I know a lot of you track those numbers. We track them closely, too. I believe that all of this will have a salutary impact on the overall functioning of the company as we make it more productive and more battle-ready for the future. I will pause here and then hand it over to Ram Charan.
He will take you through the specific numbers, and then we are open for questions. We will have about 30, 35 minutes for that. Ram, over to you.
Thank you, Anuj. I think Anuj has gone through the highlights from a financials perspective. I'll just call your attention to a few trends and numbers, then open it up for questioning. As you would have noted, you know, the AUM growth during the quarter was muted. It was a little more than 1%. If you actually see our yield, the compression on quarter-on-quarter basis has been less than 1%. If you drill down further, I think, you can very clearly see that this is entirely. I'm not saying 50%, 25%, but this is entirely because of the impact of the mix, which is that you have seen the passives grow over the last quarter more than what the active funds have grown.
So if you see from that perspective, the yields have been very stable quarter-on-quarter. We have always said that post the reset of the pricing, you will get back to the normal equation of asset to asset growth, asset fee growth. Happy to say that we are kind of tracking that and been doing better this quarter in terms of yield stability. In terms of growth of revenue, you had, you know, 11% growth year-on-year for the quarter and 1.3% quarter-on-quarter. If you further split it down, mutual fund revenue was sort of flat, almost, you know, 0.5% growth.
The non-asset-based revenue did go down on a year-on-year and quarter-on-quarter basis, largely driven by some drop in transaction revenue in quarter-on-quarter on probably MFCentral related transaction revenue, and also on OP and lack of new NFOs that are coming into the market. If you take that, I think from an overall growth perspective, asset-based revenue broadly tracks the growth in AUM. The bright story, of course, as Anuj was mentioning, is the growth of non-MF revenue. Happy to say this is across the spectrum. This is not one outlier. On a year-on-year basis, you had CAMSPay, AIF, KRA, everything growing more than 20%, right? It was not just one thing which was outside growing at 80%, others not growing.
It was across the spectrum kind of a growth you are seeing year-on-year, which is more broad-based. Even on a quarter-on-quarter basis, you know, the growth in non-MF sort of offset the weakness in the AUM growth, and hence we are able to report a 1.5% increase in revenue. We feel that this is kind of keeping in line with our projections that, you know, you will see the non-MF business grow more than 20%. This time it is 24.5% year-on-year, and for the year they are close to 18%. That's because we had a weak first quarter. Going forward, based on the run rate, we are very sure of maintaining this 20%+ growth of non-MF revenue.
From a profitability perspective, I think we put in strong numbers, more of, you know, what Anuj said on automation, et cetera. We did have a margin of 46.5% for the quarter in spite of no growth in mutual fund revenue. There was some cost optimization that happened. Just to take you back to the commentary on cost, the earlier part of the year, I think what we had said was if you're able to keep the cost increase to, say, 11% kind of a number year-on-year, I think we would have done well on target.
Happy to say that if you see the actual numbers on a year-on-year basis, including the depreciation increase because of the additional investments, my cost increase has been 9%, and if you actually remove the depreciation, the cost increase has actually been only 7.8%. On a quarter-on-quarter, we had a very muted increase in cost of less than 1.5%. We will continue to take these cost actions. We will continue to be focused on that. That is a requirement. Just to say that from a year perspective, we have ensured that, you know, the cost remains well within control, and hence you will see that there is a margin creep up in terms of year-on-year from 45% to 46.5%.
Some other important aspects I would like to highlight is, one is the diversification is on track. You would see in the 15+% number, which Anuj also mentioned. More heartening from a profitability perspective, we have been saying that once the revenue starts flowing into the non-mutual fund, you will see the profitability also grow up. You would have noted that the earlier profitability targets or the ranges for non-mutual fund was around 12%-13%. This quarter they are upwards of 16%. I think on a sustainable basis, we have said that we will get to a 20% margin by the end of next year. I think we are on target for that, too.
From a return on equity perspective, we continue to be top of market, return on equity in spite of, you know, retaining 35% of the profits and not distributing as dividends continues to be 39%. The board has declared subject to confirmation by shareholders a final dividend of 2.5, which means for the year we'll be disbursing a revenue of INR 305 crores. Overall, across the board, a very strong quarter in terms of profitability, in terms of cost optimization, in terms of non-mutual fund growth, in terms of profitability of non-mutual fund, and in terms of stable yields. With this, I'll hand it back to Danish and open it up for questioning.
Thank you so much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Our first question come from the line of Abhijeet Sakhare from Kotak Securities. Please go ahead.
Hey. Hi. Good morning, everyone. I hope I'm audible. The first question was on the OpEx line. The 10% sort of number in FY 2026 is the lowest in 5 years. You know, one is if you can put this into context of, you know, how much of this would be, you know, deliberate or discretionary expense management, given some revenue headwinds, as against, you know, some savings which could be thought of as more sustainable over the medium term. The second question is on the yield. When we think about the mix effect, the yield drop that, you know, RTAs take when it comes to passive generally is much more than the yield drop that the AMCs have to absorb.
How do we think of it in terms of really the expense or the cost that actually go into, you know, supporting the passive investments? If there is a scope for some renegotiation with respect to that. Those would be the two questions.
Thanks, Abhijeet. On the cost part of it, I think I'll just amplify what Anuj said earlier, which is that this is not a one-off. I think what we have done is a structural and automation kind of thing has crept into the entire system. If you look at the, just the numbers, right? If you see from last year to this year, while the company's strength may have grown by around 100, 120 people, we have achieved this entire 11% growth with, you will see, a reduction in the core MF operations, right? It's, there has been a reduction in the core MF operations. Obviously, some investment has happened for re-arch, some investment happened for risk and compliance, et cetera. That's kind of contributing to the small increase in headcount.
You would've seen over the course of the year, there is no operational impact for any of these things, right? Which means we continue to get industry-leading statistics in terms of compliance, risk, et cetera. There is not a 1-time squeeze that we have done of everything and which is not going to be repeatable. I think what we are approaching is a more sustainable long-term kind of an impact, is what we see. Next year, again, Anuj laid out the target saying that you're going to see further kind of optimization that's going to happen as we get more and more of this re-arch platform AI embedded into the operation system. This is, in our mind, a very sustainable kind of a cost levels. We are not saying there'll be zero addition of cost.
Obviously, that's not gonna happen. I think we will try to keep this to the minimum without impacting obviously day-to-day operations, et cetera, which we have successfully done, I would rather say below the radar in the last year, you know, without making a big show about it. We'll continue to do that in the next year also. I don't think you need to have any worry from a cost sustainability perspective. On the on the passives and how it has worked out, see, honestly, I've been saying this throughout, saying that this is such a small part of the operations that, you know, for us to kind of say a separate profit line and a cost line for this is actually not so material, given that it's less than 10% of my overall AUM.
From a yield perspective, I think the rates that we have for ETFs are extremely low by, you know, nothing to do with AMC suffering more than us or et cetera. It's extremely low. The yields for passives by nature are extremely low. I don't think there is any room for us to kind of have any renegotiation on that, you know, given that it's actually at really low levels now. As the passive increase, there will be some impact on the mix and there'll be some impact on the yield, but it'll be very muted. If you see for the last quarter, if you actually line by line compare everything, the only reason is that yields have not gone down any of the individual asset classes.
None of the individual asset classes, the yields have gone, including passives. Including passives. It is just that the mix of passives in the overall scheme of things has increased, and that's why it's causing this 0.9%. I don't see this being a big cause of concern going forward also.
I'm just following up on the yield cost, yield question. One was that, you know, because there is a mix effect, there's a hit on the overall yields. Does it allow you in any way to kind of have a stronger bargaining power when it comes to the yield negotiation on the active book, you know?
No, absolutely. That's one of the, one of the points that we will pick up in terms of yield decline, saying that the mix is also unfavorable to us. We should also be cognizant of the fact that the other side, this has a similar impact on the AMCs too. I think this will be one of the things that we'll bring across, but I don't know whether that'll be the only argument in which we'll have our hats on.
Okay, got it. Thank you so much.
Thank you. Our next question comes from the line of Prayesh Jain from Motilal Oswal Financial Services. Please go ahead.
Yeah. Hi, everyone. Now firstly, you know, just on this renegotiations with AMCs, there is a 3- 5 basis points impact, what we've heard from all the AMCs, that is likely to come, and they have indicated they'll be passing it on to distributors. Any negotiation that has happened with with you guys on on, you know, on the commission changes, or, sorry, on the RTA fee changes, that should come through because of that change?
Prayesh, so far nothing is there, but we're not saying that we rule out any discussions whatsoever on this. There may be something, discussions happening on this. One thing we are clear on our stand is that I think, from a value perspective, I think we have reached a stage where we are comfortable with the price-value equation, so there is not much of a room for us to kind of revisit that. Having said that, I think this is a discussion that probably some people will have with us. Nothing so far concrete, and nothing for me to report as something that will definitely be there. We'll keep you informed as we go along. We don't see that being a big impact.
As you said, the 3- 5 basis points impact is the entire AMC impact. I've seen many commentaries saying that it's going to be passed on to the distributors. We wait and see, if at all there is an impact, we've always said we don't think there will be any material impact on this.
You know, structurally, we've been talking about the 3.5%-4% decline in yields every year. Should we start thinking about this for FY 2027 and FY 2028 basis, and that should be the way or how should we think about the yield drop on a regular basis?
By, you know, historically, we've been very conservative in guiding you on these yields, et cetera.
Mm-hmm.
We've always said that what we have seen over the last five years in terms of trend has been this 3% -3 .5%. If you really want to build that into the model from your conservative perspective, please do. Our aim will always be to bring it much lesser than that. I think going by the last quarter, I think we are on track to have a number lesser than that, but we are not going to hurry and tell you, please take only a 1% or 1.5%. We'll, you continue to kind of work in the conservative way that you have and treat anything as a positive.
Well done. You know, the other question was, you know, while you were, we were talking about EBITDA margin improvement, and that's commendable job. You know, empirically, you know, I would like to get Anuj's thoughts also out here. You know, we've seen that, right? You know, we expand our margins to 46%, quite a few times that has happened empirically as well. You know, post that, again, we kind of there is a renegotiation or there's some investments that come in, and then we drop back to 42%, 43%, 44%. You know, at this juncture, what gives you confidence that this is more of a sustainable margin trajectory than what we've seen in the past?
Prayesh, the way I would think about this is just leading you back to the facts. We were about on a quarterly, about a 47% margin, about five quarters back, let's say. That was the first time we hit that number. From that 47%, we went down to 42% for reasons known to all of you. Then we've climbed back. It's taken us four quarters. We've climbed back, I wouldn't say exactly to 47%, but let's say 46% and some change. We've climbed back to it. I don't think it's something which has happened several times. We've been continuing to underscore 1 thing, that you should take that as a once in a blue moon, once in a lifetime event, and not as a frequent reset because the command center for this number is sitting somewhere else.
That's point number one. Point number two, from an investment perspective, and that's just a pure pricing and revenue play, which you've seen over a period of time. I'm sure you guys give credit that you are able to read us much better than you're able to read anyone else because we have cautioned you in advance. Whatever I can see, we've been telling you, right?
Mm-hmm.
We've never left you guessing in terms of what we see, but what we don't tell you, and therefore you have to guess and take a surprise the day the results come out. We have a history now of 20+ quarters, maybe 22, 23 quarters of publishing our results, and you've known things for much before that. That's point number 1. The second is that as far as investments are concerned, we've always said that there are 4 parts of the portfolio which are money-making, which is MF, AIF, payments, and KRA. Those 4 are money-making. There are 4 or 5 parts of the architecture which are not money-making, which is repository, account aggregator, pension, to an extent Think Analytics. They are not money-making, but we made the investment. We have now made the investment in ConsenPro .
We should invite you to one of our events where we unveiling this entire thing. We made the investment. We may not have made them in a high decibel way, but all these 4 or 5 businesses, like in any other business, we continue to fund till you get to a point where, like we said, traditionally, you achieve a INR 14 crore, INR 15 crore annual revenue, you break even, and then above that, most of the money goes to the bottom line. That's a standard architecture of business. We made those investments. All of those have been made in the last four years, between 2022-2026. Let's say those four calendar years, 2022, 2023, 2024, 2025. What is the choice for us now? The choice is that do we keep pushing optically on increasing this margin by about 1% a year?
My guess is that will happen by itself, not because we are doing something fantastic in MF. We will continue doing what we are doing. Also, like Ram said, the non-MF portfolio now is of a size, about INR 60 crore-INR 65 crore a quarter, and I'll not be surprised in three years if it is INR 100 crore a quarter, where it is generating money by itself. On aggregate, non-MF by itself has the power to stand on its feet. We reported a 16.5% EBITDA line, and we are hoping that we'll get to 20% and onwards to 25%. Across the board, the platform nature of the business, apart from AIF, which is very, very service-oriented, every other business is largely platform, right?
You set up a platform, you let transactions ride, you let customers come and use it as a highway, and you get paid for it. I think that character is not changing. Therefore, our focus is that we'll continue investing in new things. We will never get distracted. We will never do things which only sound fashionable. And if margins in the process expand by about 1% a year, so be it. We will not deny the right investments in business because of that.
The last thing I would say is that when you see this EBITDA line, I would take the genesis to what we did 2 or 3 years back in investing in real automation. Today, I do a payroll for 200 fresh engineers who are fresh out of or 2 or 3 years out of IITs and regional engineering colleges and NITs and those kind of places. The gain will never be seen in a month, but the gain is being seen after 2 years. Will this gain be seen only today? No, you'll see for every year in the next 5 years because it's a past period investment. Just look at it like that. I know the shadow of what you believe is unreasonable price negotiation looms heavy in your minds. I would just say that think of it as a normal thing.
Don't think of it as an oversized expense.
Got that. That's helpful. Just last bit. Do you see any impact on the KYC business because of the changes that are expected from April 1st that were implemented from April 1st? Would that impact profitability in the near term?
No. No, it should not. Just to be clear, we are expecting to hold KRA revenue in FY 2027 after all the puts and takes. What are the puts and takes? Whatever hit we had to take because of slow Demat and broking and F&O account opening, we've already taken in FY 2026. Some upside, INR 2.5 crores- INR 3 crores we'll get from NSE KRA. Some revenue down about INR 6 crore- INR 7 crore, maybe INR 8 crore rupees we will take from the price down. I have the base revenue - INR 8 + INR 3. I lose about INR 5. That INR 5 we'll make up through growth and increase in share. We will have flat KRA revenue. We do not expect that there's any profit challenge there.
Got that. Thank you so much, and all the best.
Thank you.
Thank you. Our next question comes from the line of Devesh Agarwal from IIFL Capital. Please go ahead.
Yeah. Thank you for the opportunity, sir. Firstly, sir, just on the margins, you did mention you don't see any significant yield pressure, but you also said that the new TR regulation for some of the large AMCs are underway. If this were to kind of fructify, the impact will be retrospective starting from first of April. Is that correct, or this will be more like a retrospective starting from first of July?
Sorry. I don't think, Devesh, just to clarify, we did not say that there are some discussions happening with any AMCs on yield. I think what we said is, nothing substantial is happening on that and, we don't rule out the possibility of, you know, something like that happening over the next month or two. You know, even if it happens, it's gonna be extremely muted. I think it's premature to speculate whether it's gonna be first April, first July, because we don't even know whether it's gonna happen or not happen. What we are saying is that if the discussions do happen, at that point of time, we will kind of decide appropriately, and whatever happens will be muted. We will see at that point of time.
I don't think that we should have a significant impact of that from a recent perspective. The other contract negotiations, we will not have a big price down. That is for sure. We have some midsize contracts coming up for renewal in the course of the year. Overall, all put together, we don't see that being a big impact on the yields.
Understood. In terms of the OpEx, will this be another year where you'll see a single-digit growth in the OpEx, especially in your employee costs? We see that the growth has only been 5%. Anuj did mention that this time there could be a reduction in the headcount on overall basis. Are we looking like another year where the growth will be less than 5% in the employee cost?
Yeah, absolutely, we are. Obviously, there is this increment that will have to be factored in, which will kind of come from Q2 of this year. That's when the increments will become effective. There'll be some impact of that. I think we will look at sub 5% and overall, definitely some 9% kind of a growth in expenses. We'd like to make it a little lesser than that, but that's what we are shooting for.
Right. Sir, in terms of EBITDA margin, what would be our expectation or target, for FY 2027?
We've, we've always said that, you know, we don't want to guide for a specific EBITDA margin. We've always been range bound, and we've said that in a bad quarter, it'll be less than 45%, in a good quarter, it'll be around 46%, 47%. I don't see any reason for changing that. I understand that there is a cost, you know, kind of thing. We'll have to wait for the asset growth, number and revenue growth number. As you know that we are kind of waiting for the markets to settle down on that. For us to give a specific EBITDA number guidance will be difficult, but our aim is to at least retain what we are in Q4, right, in terms of the EBITDA margin for next year.
This is after absorbing the increase in cost that may happen because of the salary increase and other investments we'll have to do, and some yield compression that will happen, although not as much even close to what it was last year. After that, I think if we do maintain the 4Q EBITDA margins, I think it'll be a good target to have.
Right, sir. Sir, finally, on the non-MF side, you did mention that targeted growth is around 20 odd percent, and we have already reached a revenue share of 14% in the non-MF business. Are we looking at any new line of business on any further diversification that can add to the revenue growth, or this will be the existing businesses in which we'll see the growth?
Devesh, I would say right now, like we've always said in the past, that building a product in markets where you may not have the right to win and competing, you know, against, not just traditional kind of competitors, but against startups, fintechs, et cetera, is not easy. We don't want to get busy creating products where we have no business to be present. Consen, therefore, the DPDP compliance product is the only product that we are putting out. We may put out one adjacency. We had put in the deck, I think, which is a device, a unified device which will do payments and KYC, et cetera. It's an adjacency. It is just going to expand the MF SIP market. It'll do nothing else. We do not believe that we are angling for too many new things.
We will just focus on what we have. We believe there's scale opportunity in payments, significant scale opportunity. We believe that RTA should continue kind of building mass. Like I said, we will hold KRA revenue despite all the puts and takes, and AIF will hold on and grow. Between all of these and anything else that we do on the consent on the CAMS and smaller product side, we believe that we have absolute confidence in growing at least 20% on that side. MF, the story will unfold during the year as we see asset growth come back after the last two months. That's the broad story. To answer your question, we don't want too many distractions. We're not in the habit of just opening markets or just jumping into products just because it sounds fashionable. You will see that behavior, more than less.
Perfect, sir. That's all from my side. Thank you.
Thank you.
Thank you. The next question comes from the line of Supratim Datta from Jefferies. Please go ahead.
Hi. Thanks a lot for the opportunity. I'll start with, you know, maybe the mutual fund side. Just wanted to understand, you know, if you could give us some update regarding the transition of the RTA business to cloud from prem. Where are we with respect to that, and how are we thinking? It was supposed to be a 3-year project, you know, where are we and, you know, what kind of changes or, you know, new products from that could we see over the next coming years? That's one bit. Secondly, you know, there has been already a lot of discussion on the OpEx space. Just wanted to understand what was the employee count that you ended at FY 2026 with. Going ahead, what are the other areas where, you know, you could maybe now reduce cost?
Lastly, you know, coming to the non-MF side, you are gunning for a 20% growth. The KRA business is supposed to be flat in FY 2027, and that's one of the major parts of the non-MF business and has been a key contributor of growth. Just wanted to understand which are the other parts of the business that you think will be able to deliver much higher growth in FY 2027. You know, so that is one thing if you could give some color. Lastly, just wanted a clarification. The 16.5% margin on the non-MF side is for FY 2026, right? Not fourth quarter 2026. Yeah, those are my four questions. Thank you.
No, no, sure. I guess one of us must have noted your four questions, but I'll start with the first one, which is on re-architecture. On the re-arch side, the plan was and is to build a brand new, hosted on the cloud, kind of a cloud-native platform which does the entire MF service delivery and platform delivery from the cloud. We have opted for a feature-by-feature, module-by-module build-out, taking things live one by one. The other approach could have been to kind of build it all together and then test it, and that is like moving an army because you could have gone wrong just anywhere. We will be taking things live module by module. There are about nine significant modules.
Think of it as nine significant modules and then a number of things surrounding all of these, and I'll give you an example of what has happened on both sides. Of the nine modules, the first one, which is transaction origination, which is getting transactions in from whichever mode they come in from, whether it is exchanges or banks or websites or, you know, partners and fintechs, including paper and branches, all of that. That module is fully built and is now getting launched in the marketplace for consumption by a very broad audience. There are literally several thousand people who will integrate and start passing transactions on. It has several merits in terms of, you know, having a better rules engine, giving you rejections in real time, et cetera, so that remediation can happen.
Any net shrinkage which happens because of, you know, transaction rejections, et cetera, it comes down. It is a creator for the industry. That is the first thing which is live. We are taking it to the market. The second last thing which is ready with us, but obviously has to be taken to the market because, there's nothing that I can sit here by pressing a button do unless it's an internal process, is this entire concept of a data lake where our entire on-prem data is now, AMC by AMC sitting on the BigQuery on Google Cloud. What it does is that all the MIS, all the insights, all the analytics, all the what-ifs can be done by speaking to a machine, can be done by our people, can be done by AMC people over a period of time.
Other partners will also be able to do it. It is the most futuristic and capable, single instance of, you know, a data lake that has been built, and that will go live again in one edge of this year. Beyond this, of the core nine, other modules like payments and settlements, transactional exchanges, internal posting of transactions, all of that accounting will go live over a period of time as they get built. We have a team of close to 200 engineers working on this. We've not lost the opportunity to kind of also build some of these smaller things which are relevant, which are internal only, which means I don't really have to interface with the market.
The example that I gave you, which is of form data extraction, which means we still get about 1 million physical forms in a month, and we are now in the process of taking a maker layer out. You've heard the term maker-checker. Two people trying to do the same data entry located at different parts of the universe, and an engine compares what they have done. We are taking the maker out completely. AI is doing the entire making. That part is live. Similarly, there are several smaller parts which are live. This was envisaged to be a 4 to 5-year project. My advice would be to strictly think of it as a 5-year project, not even 4. About 2 years are done, which means the first 2 years are done, and you will see significantly increasing momentum as we move forward.
The revenue productivity and overall productivity that you've seen, I gave you a metric of flat headcount and growing revenue. Over the last 3 years, we've also seen transactions grow at 27%, headcount grow at about 6%- 7%. You will see all of that get accentuated as we move forward with that platform. I would say we are about 3% - 4% behind on the overall curve of the trajectory, which is normal in IT projects of this nature. Broadly, we are completely on track from a business benefits perspective. I'll pause there because you had three more questions. Do you wanna take the other two?
Yeah. Supratim, your next question was on headcount, and how did we exit 2026, et cetera, with the current 2025. The exact headcount I'll give you is at 8,300, right. The 8,324 is what we had in 2025 end. I'm saying headcount as of year-end, it's not the average for the year or something. Exited 2026 with 8,420. We had around 100+ people. If you actually take the re-architecture hiring that we have done, which is for the new platform, that itself was more than 100, right? From overall MF perspective, we actually, as I mentioned earlier, we dropped headcount by around 70.
You know, we had some increase in the risk compliance in kind of non-mutual fund businesses, investments, et cetera. That kind of made it neutral. Overall, if you see, if you take away the hiring that we have done for technology re-arch perspective, it was a flat headcount year-on-year. The aim that Anuj was saying next year is to kind of better this and actually have some more optimization and have a net reduction in headcount. That's the way the numbers will play out in the next year also. In terms of non-mutual fund growth, I think your question was, given the KRA will be flat, how do you think that you'll be able to receive the 20%?
If you just break it down to numbers, right, and depending on the exit quarter or on the last year, you're talking about a INR 45 crores, probably close to INR 50 crores kind of a growth in non-mutual fund revenue. If you actually break it down further, I think we are confident of CAMSPay taking at least INR 20 crores of that, if not more. You know, AIF taking some INR 7 cores, INR 8 crores of that. Then, you know, TSP, pension taking some INR 4 crores, INR 5 crores. Repository taking some INR 7 crores, INR 8 crores. You have the new lines like ConsenPro, you have GIFT City, et cetera, which will take a few crores. If you actually break it down to a INR 45 crore- INR 50 crore increase, I think we have a solution. We have plans behind it. We have a solution.
Our aim is obviously to better the 20%, but I think 20% is a reasonable visibility we have, assuming that there is no growth in KRA.
Perfect. Sir, any particular line that, you know, you see driving that INR 40 crore-INR 50 crore additional revenue? Or is it going to be across the other businesses?
Sorry, say that again. I think we missed what you said.
Sir, yeah. What I was asking is in the non-MF side, you know, this, the incremental growth, is it going to come from, say, payments or repository? Is it going to be across the four, five businesses that you have?
No, it'll be across. I think that is what Ramn Charan was trying to say, that if we convert this into simple arithmetic, you're looking at a base of about INR 60 crore-INR 62 crore of quarterly revenue at exit. About INR 250 crore in the base. To grow 20%, you need a INR 50 crore revenue up solution. Of the INR 50 crore revenue up, your question is that if KRA is zero, where does the INR 50 come from? I think that is what he was trying to answer. Payments will be about INR 20 crore out of that. AIF about INR 7 crore-INR 8 crore, and repository about INR 7 crore-INR 8 crore adds up to about INR 35 core. Everything else, the balance INR 15 crore is a sum of the account aggregators, the TSP, pension, all of that put together should add up to another INR 15 crore. That's where the INR 50 crore comes from.
Understood. That's very clear. Thank you.
Thank you. Our next question comes from the line of Dipanjan Ghosh from Citigroup. Please go ahead.
Hi. Good morning, everyone. Maybe just coming back to one of the previous participant's questions. You know, you mentioned that one can probably conservatively build in around 3.5%-4% MF field decline, and maybe you'd gun for maybe in the range of around 1%-2%. Whether it's 3.5% or 1%-2%, I mean, just wanted to get some sense of what are you factoring in, you know, when you kind of are thinking along those lines. Is it a factor of the negotiations on the mid-range AMCs that you mentioned, which are planned? The asset mix, what are your expectations on that?
Also, you know, any probable discussions that might take place as you highlighted that you do not rule out any possibility of further discussion. Just to run against the factors that you are kind of building in this expectations of MF fees. The second question, the third question are data-keeping questions. On the CAMSPay business, if you can give some color on the MF and the non-MF, and within the non-MF also, if you can kind of break it up into some subparts. Also on the KRA business, what would be the composition of the non-MF business currently?
Yeah. On the MF field, Dipanjan, traditionally, I think the 3%, 3.5% comes from historical numbers, right? Rather than any breakup of what the expectation of the mix will be. Over a period of time, and you would assume that over a period of time you've had various combinations. As I said that this is determined by not only asset mix, it's also customer mix, it's also negotiations, it's also scale-based pricing, everything put together. It's a complex kind of interplay of factors. The 3%, 3.5% is something that, you know, historically we have seen. Now, we have seen years where it is 1% also, we've seen years where it is 8%, 9% also. It is just an average, right? From that perspective.
Given that next year would be a normal year in terms of there being no big strains on yields. Just to again clarify, we are not saying that we are gonna have discussions with AMCs on price, et cetera. The question was on specifically with respect to the 3-fold basis points yield compression that the AMC, some of the AMCs may face, and we just said that we don't rule out any discussion that they may open on all these things, because it's more their choice, right? Nothing that got to do with us. We're not saying there's gonna be any big negotiations. In fact, we see a period of yield stability. Now, our aim and our calculations are that this will not be 3%, this will be less than 3%.
Given that historically we have been around that number, I think it was prudent for us to kind of quote that number as a number that probably you can work with. Having said that, you know, it's a combination of everything. We do expect some, you know, equities are close to 40%, 54%, 55%, so we don't expect that to go up much more in the mix when we did this calculation. We do expect some sort of growth to come from the larger AMC customers, which will have its own impact on the yields. Finally, we do have some mid-size AMCs who are coming for discussions, but we don't expect a material decline in yields because of those discussions.
All those things put together, our aim is to keep it down to the scale-based pricing plus some minor adjustments here and there and not get into some major things. That is why we said it'll be much less than 3%. If I may just go to your second question on CAMSPay. CAMSPay, happy to say that the non-mutual fund share has been much more than 50% on the back of cards, right? In fact, in the last quarter, if you see the PG business, which is the credit card business, mainly for insurance companies and some for loan repayments, et cetera, is almost, like, 25% of the revenue, right? Almost more than INR 2.5 crores.
Starting almost from year zero, probably a year back, we have now reached 25% of the quarterly revenue coming from cards business. Most of it, I'm sorry, all of it is non-mutual funds. Our non-mutual fund revenue is much, much more than 50% now in the CAMSPay. In terms of split into how much is insurance and how much is kind of other sectors, most of the non-mutual fund is from insurance and EMIs for NBFCs. The exact split I'll let you know, this is basically how their revenue is split. Your question was on KRA. KRA, I think we have reached a 30% non-mutual fund share of the revenue, and we are onboarding a couple of new brokers, as you would have seen in the presentation, couple of large ones. We expect that this 30% will start creeping up in the coming quarters.
Got it. Thanks, Ram, and all the best.
Thank you. Thank you.
Thank you. The next question comes from the line of Madhukar from JP Morgan. Please go ahead.
Hi. Hi, sir. Congratulations on a good set of numbers. Just two questions from me. First, what is the kind of pressure that we are going to see on the KRA business? What sort of pricing decline are we seeing? You know, how is this determined? Is it? We understand that there is, this is like an industry-wide phenomena, but I also gather from our previous conversations that we were already at a discounted rate. What sort of hit in sort of blended pricing would we be looking at? Second, I wanted to get a sense of the new opportunity that Anuj sir was speaking about. It's something that I'm not that well aware of this ConsenPro , so maybe you could give some background and, you know, about this opportunity. Thank you.
Sure. Thanks, Madhukar. On the KRA, I mean, effectively, just think of it that starting 1st April, uniformly the KRA industry has taken a 20% price down. Why have we taken a price down? Obviously, there was a reaction from the industry, not for a day or two, but for a long time, that in order to broaden the franchise and bring in lower value consumers, and you know that the industry has been bringing lower value consumers. The Choti SIP was a campaign around that. There were multiple, you know, initiatives to collect money from non-salary people daily, et cetera. The KRA cost was seen as a bit of an obtrusive amount. Not our opinion, but obviously as a collectivity, that's what the industry thought.
Initially, we had specifically done a remission for small value, but it did not look like that gave a lot of room to spread, I would say, happen across. The industry came together and said that let us then just lower KRA prices. I think it's a voluntary action. It is done together at industry level. It has nothing to do with a single instance of anyone coming and negotiating. Of course, there was a long dialogue with the industry and with the regulator when all this happened. I think in good faith, it's a good step. You also know that concurrently, we have enriched the KRA architecture so much that today, we do a daily Demat reconciliation. There is now visibility records inside of that.
There is a lot of enrichment from a record-keeping perspective, and then there are lower prices. Like I had said that FY 2027 for KRA, we are projecting a flat revenue. On a base of about INR 42 crore-INR 43 crore, we're expecting about INR 8 crore price down lead. That's just the fee remission.
We're expecting about INR 3 crore of revenue up from the NSE KRA part, which showed up a little in January, February, March, but will show up for the whole year, that's net addition. The balance INR 5 crore, the INR 8 crore - INR 3 crore, which we will lose because of price, we are expecting to make up through natural growth and new logo wins, et cetera, which is entirely possible. We will keep about flat revenue. I would not read a lot more into this. I'm expecting that the KRA machinery continues to kind of grow with the industry and enable the industry a lot more. There will be less talks about bringing in smaller value consumers now that the KRA price is down. That's point number 1. The second question was on ConsenPro .
You know that the Digital Personal Data Protection, that's what DPDP stands for, that bill, which essentially I would not say is cloning the GDPR regulation in India, but it's somewhat, somewhere on those lines, is now being contemplated across the board for every industry. The financial services sector, of course, will be one of the biggest consumers. We started working on this to do this ourselves. We just wanted the expertise to be in-house rather than to buy it. We built this product called ConsenPro . It has a consenting mechanism. It has a full data discovery tool, and someday it's perhaps integrated for you to sit with one of our people to just see what it does. It has various other angles of regulatory reporting and consulting and all of that. All of that comes packaged under ConsenPro .
We build this inside of Think360, and it's a commercial offering now. We decided to make it a commercial offering because we know that almost 40,000-50,000 Indian companies will end up buying this in the next year and a half. No harm in, at least assisting the capital markets and the financial services segment with this. If you want more details, happy to have a separate conversation, but that's broadly the view behind this.
Got it, sir. Thank you and all the best.
Thank you.
Thank you. Our next question comes from the line of Sanketh Godha from Avendus Spark. Please go ahead.
Yeah. Thank you. Thank you for the opportunity. I think most of my questions got answered. Just one small question on KYC business again. I mean, finance ministers, the chairman of late has spoken about one KYC thing for all financial sectors, including capital markets. Does it change the conduct of the business? Whether the pricing, because it will be CKYC limited, in a way, pricing will come down and what are the effects that revenue will or the uploading of information revenue is there, we will see a meaningful change? We just wanted to understand one KYC will make any material change or not.
Well, I would say we have to watch it. We have to continue watching it. This has been in the air for some time now. Just so that you know, uploading of any new KYC records that the KRA gets, that obviously in the MF industry, it does get uploaded to CKYC, so that leg is intact. Does a CKYC record, is it eligible completely to create a KRA KYC? Not yet. So I think the price down is a first step to make it easy for the industry to broaden itself. Like I said, that was attempt number one. Your question perhaps is that will there be a day and will there be a day soon where CKYC subsumes everything under itself and there is no KRA KYC left?
I think, from a feature, benefit, just architecture, interoperability, the fact that KRAs authenticate all the data themselves and do not just do or tape what the intermediary tells them, but there's a separate layer of authentication. That's a significant amount of value that is embedded in the KRA architecture. It is not completely like that in CKYC. Maybe at some time it'll get there. I think it's good to keep watching this conversation to see where it goes. Right now we believe we are in good shape.
Understood, Anuj. When you say verification, is it largely related to, say, PAN card information or FATCA information? Anything, when you exactly say verification, how it is exactly different from CKYC download compared to KRA download?
When an investor, let's say, goes to a microfinance institution, the microfinance institution would take his details, verify them, which means they will either look at the originals. Most of the time they look at the originals. Then they will upload that information to CKYC. In the KRA architecture, the intermediary will take all of those, will do whatever verification they are doing. KRA will do a full verification, so a name match, a face match, a DOB, an address from source, typically DigiLocker or UIDAI. It's a two-leg process rather than being a one-leg process.
Okay. Understood. I mean, basically even if, say, CKYC becomes one KYC kind of a norm, given, authentication verification part is too strong here, is it fair to say that, we will not see a meaningful disruption even if CKYC gets adopted because of that extra second layer of verification?
Well, they're trying to build a lot of these features. All I can tell you is they are trying to build a lot of these features. Like, you know, Rome wasn't built in a day, so it will take some time before those, you know, tens of crores of consumers kind of fit into this architecture. For their roadmap, they are also trying to build it. I would say the KRA architecture has been significantly ahead of market in the last five years in building all of this ahead of time and implementing it in all investors.
Understood. Yes, that was my only question. Thanks. Thanks for the answers.
Thank you.
Thank you. Thanks again.
Thank you, team. Ladies and gentlemen, that was the last question for today. I would like to hand the conference over to Mr. Ram Charan for closing comments. Thank you. Over to you, sir.
Thank you to all the participants for spending time with CAMS and following our story. If you have any queries, please do reach out to Orient Capital or Anish Sawlani, and they'll be happy to assist you. Once again, thanks for your time.
Thank you, sir. Ladies and gentlemen, on behalf of MUFG, that concludes this conference. Thank you for joining us. You may now disconnect your lines.