CAMS Q2 FY27 Earnings Call: First Quarter Above Rs. 400 Crore, Non-MF Revenue Grows 21-22%

Computer Age Management Services Ltd held its Q2 FY27 earnings call on October 29, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

First Quarter Above Rs.400 Crore; PAT Outpaces AUM

• Revenue Rs.415 crore, +10% YoY — first quarter above the Rs.400 crore mark despite muted industry AUM; PAT grew 14.5% YoY with no one-time or past-period items, per management.
• EBITDA ~Rs.191 crore, +13.5% YoY — margin expanded 140 bps YoY to 46%, absorbing employee increments deferred from Q1 to Q2 FY 2026-2027 and ~Rs.4 crore of new-platform costs.
• MF AUM +12.5% YoY to Rs.58.5 lakh crore (67% share) — equity AUM grew 15.5% vs industry 15.2%; gross SIP collections +16.5% vs industry 12.4%; CAMS share of industry equity net sales upwards of 70% over the trailing one year.
• Expense growth a little over 7% YoY — vs FY 2026-2027 guidance of under 10%, despite an Rs.8.5 crore annual appraisal impact (~2 percentage points); management characterizes the productivity gains as sustained, not one-off.
• Cash of Rs.900 crore at Q2 FY 2026-2027 end — after paying ~Rs.160 crore of dividend during the quarter; interim dividend of Rs.3.25 declared.
• Depreciation Rs.28 crore vs Rs.25 crore in Q1 FY 2026-2027 — >Rs.1.5 crore of the QoQ increase from re-architecture modules going live; CFO urged using Rs.28 crore as the base going forward.

Yield Decline Within Guidance; No Renewal Discounts Embedded

• Q2 FY 2026-2027 yield decline <1% QoQ, ~3% YoY — within standing guidance that some quarters could see 3-3.5% drops; management reaffirmed the FY 2026-2027 outlook of around 3% yield decline (less than 2.5% in a good quarter, ~3% in a reasonable quarter).
• YoY decline driven by mix, not discounts — scale-based pricing on ~7 lakh crore YoY AUM growth, debt (~2-2.25 bps) replaced by passives (~0.5 bps), telescopic pricing (~2% impact in a normal year); no large customer or renewal discounts embedded.
• H2 FY 2026-2027 yields to stay stable — CFO stated there is "no reason for a disproportionate higher discount or reduction in bps" in AMC renewal discussions.
• Large AMC renewals fall in FY 2027-2028 — CFO declined to pre-comment on outcomes but expressed confidence the company's stance will prevail and does not expect a repeat of the past discount event; factors cited include productivity, hardware costs, and ongoing investments of several hundred crores in SEBI requirements.
• Newer AMCs a minimal yield drag — AMCs launched in the last 5 years sum to only ~2 lakh crore of the industry's 58-59 lakh crore AUM and are expected to contribute only ~5-7% of the AUM and revenue book in FY 2026-2027; 3-4 mid-sized AMCs have outgrown the market, a positive yield influence.
• SIF pricing mirrors regular schemes — no yield premium or discount; from a billing perspective it is another scheme of the same mutual fund.

Non-MF at ~16% of Revenue; Payments and KRA Lead

• Non-MF revenue +21-22% YoY, +11% QoQ in Q2 FY 2026-2027 — just under 16% of revenue (+150 bps); >20% annual growth in most of the trailing 12 quarters; management expects 20%+ growth to sustain with none of it one-time (period unspecified).
• Non-MF margin above 18%, close to 19% — vs 12% last time; management aims to exit FY 2026-2027 at close to 20% non-MF profitability.
• CAMS Pay +50% YoY, +13% QoQ, crossing 6% of revenue — vs ~3% 2-2.5 years ago; MD guided the payments business to grow ~late 20s-30% each year over FY 2027-2028 and FY 2028-2029 off a current base of Rs.100 crore+, with the ~50% YoY pace possibly lasting only another quarter or two (through ~Q4 FY 2026-2027).
• KRA serves 5 of the top 10 broking houses at 10-25% share each — QoQ is the relevant growth metric after a 20%+ fee remission in Q1 FY 2026-2027; phase-one inquiry/status API revenue was only ~Rs.1.5 crore of the Q2 increase, the bulk from new customers and volumes.
• Alternatives revenue +22% YoY, AUM crossing Rs.3.3 lakh crore — 50+ new mandates and 15 new marquee relationships, largely from non-MF AMCs; AIF stable at ~20% margin with limited operating leverage.
• UPI MDR upside minimal — CEO advised modeling very little revenue impact: a Rs.100 crore book would yield only Rs.1-2 crore of incremental revenue once MDR on UPI is implemented (period unspecified), unlike retail UPI peers who expect tens to hundreds of crores.
• Mix glide path — non-MF scaling ~2% per year at the current FY 2026-2027 pace (slightly below management's expectation); MF revenue share, now ~84%, could reach the early 70s% in 5 years' time (≈FY 2031-2032).

Re-Architecture ~30% Complete; Headcount Down via Non-Backfilling

• Cumulative Rs.27 crore of re-architecture cost taken to OpEx through Q2 FY 2026-2027 — Q2 included ~Rs.5 crore (~Rs.2.5 crore incremental OpEx plus ~Rs.1.5 crore depreciation); quarterly platform cost guided to rise to ~Rs.8 crore in Q3 FY 2026-2027 and Rs.9.5-10 crore by Q4 FY 2026-2027, with net incremental P&L impact of only Rs.1-1.5 crore (max Rs.2 crore) per quarter over Q3-Q4 FY 2026-2027.
• Headcount down ~250 to ~8,200 — from ~8,450 at the start of FY 2026-2027 (250-300 including outsourced reduction); management expects the headcount-down trend to last at least the next three years, with new-platform productivity (>50% of the levers) key to holding cost growth near 10% over a 3-4 year view.
• AI form-reading in production since ~March-April 2026 — checker replaced in some cases, maker retained; Rs.4 crore of AI-related cost in Q2 FY 2026-2027 expensed to P&L management argued the AI question should justify higher, not lower, prices, and that building complete systems purely on LLMs is "still some distance away" since feeding IP into an LLM surrenders rights to it.
• Fundsnet live; legacy utility sunset by March-April (Q4 FY 2026-2027) — expected to lift productivity industry-wide; NISM adopted CAMS Lens as its AI-powered compliance training partner; new eKYC KYC Hub seeing industry adoption.
• ConsentPro (DPDP implementation, BFSI focus) under implementation with 20 clients — since market entry in April-May FY 2026-2027; management believes it must scale 10-20x to become meaningful (period unspecified); not expected to be a Rs.100 crore franchise — a Rs.20-30 crore franchise in 2-3 years (≈FY 2028-2029 to FY 2029-2030).
• Insourcing risk dismissed — CEO cited global benchmarks where "90-95% of the outsourcing industry has remained intact" across banks, airlines, telcos and insurers; regulation requires CAMS to maintain 4 data centers (3 normal + 1 air-gapped) while AMCs hold only a constructed copy of the data.

32 of 64 AMCs; SIFs, GIFT City and Bima Central Build Out

• InCred AMC appointed CAMS as MFRTA, taking the count to 32 of 64 licensed AMCs — ASK Investments and Candalian went live with maiden funds in Q2 FY 2026-2027; Oakland and Neo expected to go live in Q3 FY 2026-2027.
• SIFs: 12 CAMS AMCs launched, AUM at Rs.20,000 crore, ~1 lakh investors — early days; GIFT City retail funds crossed Rs.1,500 crore AUM with 5 launches and 2-3 more expected in Q3 FY 2026-2027.
• Repository crossed 15 million (1.5 crore) DMAT policies — Bima Central launched a broker module white-labelled on broker apps/websites; management flagged a directional possibility that the insurance industry may move heavily to digital distribution, expected to unfold over the next 2-3 quarters (through ~Q1 FY 2027-2028), with CAMS believing it is best placed as the single player with a significant servicing layer.
• Account aggregator grew 19% YoY — PFM module deployed for one of India's largest banks showing financial wellness scores; a new pricing model remunerating FIPs is about to come into the AA market (period unspecified).
• Insurance optionality — management assigns a 50% chance that insurance becomes the next directional 10-year trend line market, analogous to equity broking (2010) and MFs (2014-15), but says it is very early days to predict.

Margin Trajectory Intact; Growth Repeat "Broadly Yes" Over Two Years

• PAT growth repeat "broadly yes" — management said it can repeat the Q2 FY 2026-2027 outcome (12% MF AUM growth → 14.5-15% PAT growth) over FY 2027-2028 and FY 2028-2029 if moderate growth persists, but declined to guide on a 7-8% AUM growth scenario until such a quarter occurs.
• 100-200 bps annual margin expansion reiterated — standing expectation in normal years (period unspecified); repository, KRA, payments and MFRT are largely 100% platform businesses while AIF retains a services character.
• Non-MF margin of 25%+ "very much on the cards" over 3 years (~FY 2029-2030) — predicated on KRA as a very profitable franchise and payments reaching 25% in 3 years if current growth proportions hold, with the aim to get closer to 30%.
• Employee cost run rate confirmed — Q2 FY 2026-2027 employee cost can be taken as the run rate for the remaining quarters of FY 2026-2027.
• Non-asset MF revenue to keep declining as a share — down from ~14% to ~11% as of Q2 FY 2026-2027; CFO confirmed it should be modeled as YoY percentage growth rather than off asset growth, with no numeric outlook given for the analyst's 3-5 year horizon.
• Watch items: platform cost step-up through Q4 FY 2026-2027, large AMC renewals in FY 2027-2028, and the ~50% CAMS Pay growth pace possibly fading through ~Q4 FY 2026-2027.