MD’s Message

Dear Shareholders,

I am pleased to present the Annual report for FY23. The year has been satisfying with the MF Industry posting a positive increase despite the headwinds of global volatility, inflationary trends and rising interest rates. Mutual Funds continued to be a preferred choice of retail investors and recorded new highs in the asset base. Enabling the business growth of MF Industry is core to CAMS’ value proposition. Its support for the industry is engineered through superior technology, solutions for new products, development of new services and creation of brand-new digital conveniences apart from others. We also made significant strides in other business verticals and built momentum in the new businesses. It’s a privilege to share the key highlights of the year with you.

Financial Performance

During FY23, the consolidated revenue of the Company was ₹ 971.83 Crore which was a 6.8% increase over the previous year. The PBT at ₹ 380.19 Crore marginally down by 0.6% compared to the previous year. Dividend of 375% inclusive of the final dividend to be approved by the shareholders was recommended during the year.

Customer Satisfaction

The Company’s philosophy as reflected in its mission statement – ‘Our Mission… Your Growth’ – mirrors our core value of serving customers, including investors, intermediaries, clients, employees, and every other stakeholder. This mindset that drives our service efficiency has invoked deep appreciation from our customers. The recent customer satisfaction survey showed a response of 96.1% of the respondents stating it as very satisfied/satisfied. More than 40K investors who utilised multiple modes of touchpoints offered by CAMS responded to the survey.

Operational Excellence

Mutual Funds

FY23 marched ahead to see month-on-month increase in volumes as retail investor participation remained steady on the back of their confidence in the capital markets and in Mutual Funds in particular. Transaction volumes scaled to nearly 39 million monthly transactions, catapulting the annual transaction volume to 466 million, a 12% increase over the previous year.

SIP registration momentum kept pace to the positive sentiment to record in excess of 15 million new registrations during FY23. CAMS serviced Funds garnered 71% of the NFO collections and supported new MF folios to touch 13 million during the year. We maintained our strong focus on operational excellence for the long term with continued investments in technology and people. CAMS operations, technology, intermediaries’ support, digital enablers, customer service and front offices stretched every sinew to ensure high service delivery for these staggering volumes.

Milestone events such as Transition of L & T Mutual Fund’s assets to HSBC MF, change of control of IDFC MF to Bandhan MF and onboarding of NAVI Mutual Fund were carried out smoothly without any investor inconvenience.

Firmly focussed on client convenience, we have used technology and innovatively evolved smart strategies for investor satisfaction. Many of the technologybased initiatives that went live during the year, enabled the Company to improve its delivery standards.

Technology & Cybersecurity

Adoption of cloud native technology increased during the year including hosting of the NPS - CRA platform (the first one in the NPS ecosystem) which won commendation as Exemplar from NASSCOM. Leveraging AI and modern API capabilities, we have transformed business processes such as reconciliation, customer service and KYC to enhance customer convenience and reduce risk.

Cyber-security industry is facing rapid advancements because of increased malware attacks across the world. As the threat landscape continues to grow and is ever changing, CAMS has taken significant actions to improve the maturity of the security baseline across the enterprise systems. We implemented CIS Security baselines / controls to cloud workloads operating across multiple platforms and improved the overall score to 4.74 out of 5.0. Security controls across cloud workloads were enabled and hardened as per industry best practices and continuous monitoring is in place. We continue to sustain BitSight score of 800, which is at Advanced level, ensuring all existing and new webbased applications and interfaces meet the rigorous and heightening standards of BitSight.

Beyond Mutual Funds

We made significant progress in our businesses beyond Mutual Funds as highlighted below:

AIF and PMS

Our market leadership in the Alternative Investment Fund (AIF) and Portfolio Management Services (PMS) services space further solidified during the year. We now cater to 130 fund houses (375+ schemes across investor servicing and fund accounting services) and service over ₹ 1,50,000 Crore AuM. Our feature rich digital onboarding solution – CAMS Wealthserv for AIF and PMS launched in 2021 continued with its dream run this year with more than 50 clients signing up for the solution. We, continue to expand our footprint in GIFT City with 6 AIFs being serviced out of the CAMS branch in the IFSC.

Account Aggregator (AA)

AA platform continues to receive support from government and regulators in emerging as a unified financial data sharing platform for consumers. All large PSU Banks have signed up with AAs. On capital markets, SEBI has issued guidelines to AMCs to Go Live as FIPs through respective RTAs. Akin to SEBI, PFRDA has issued mandate to all CRAs to be live in AA ecosystem. Insurance Regulatory & Development Authority too has written to all insurance companies to be live in AA ecosystem and we are seeing traction from all Insurance companies including private and PSU insurance companies on both Life & GI space for onboarding as FIPs & FIUs (Financial Information Users).

The AA ecosystem continues to see expansion in the use cases for which FIUs are creating user journeys for taking customer consent. CAMS is taking the lead among AAs to evangelise about this path breaking initiative.

Acquisitions

CAMS deepened its digital footprint in the AIF ecosystem and Artificial Intelligence spaces with the acquisition of controlling stakes in Fintuple Technologies and Think Analytics. Fintuple is a new-age start-up that has launched niche technology offerings in the areas of digital on-boarding of clients, KYC, fund data, fact sheets and analysis and other digital support solutions for AIFs, PMS and Custodians. Think Analytics, offers Software as a Service (SaaS) based products and data science services to its customers in India and abroad and is in the process of launching analytical solutions suitable for use with the Account Aggregator framework.

Recon DynamiX

CAMS Recon DynamiX, an industry agnostic solution, is a robust and powerful tool that automates the reconciliation process to produce high quality and accurate financial statements. Built on the cloud and imbued with an ability to integrate with other company systems, CAMS Recon DynamiX is a unique and reconciliation technology solution that will give users a consistent experience with single – sign on, without having to switch between multiple systems. Organisations will gain a global view of the entire recon process with the ability to monitor frauds and inaccuracies. We have commenced deployment of Recon DynamiX for Insurance Companies & Mutual Funds’ Asset side reconciliation PMS. There is wide-spread interest for the platform from across sectors.

Insurance Repository

Our dominant position in Insurance Repository space with 5 million eInsurance policies is opening new vistas and opportunities. CAMS Rep has embarked on an ambitious project – Reimagine - to build a platform that allows policyholders to understand and access all their policy benefits through single window. Our most recent efforts include the launch of the following:

• Digital Policy Platform - Instant policy conversion to electronic forms
• Insta eIA - Real-time creation of an e-Insurance account
• Digital Loan Assignment Platform - Digitising the entire loan policy assignment process, bridging the current gap between financiers, insurance companies, and policyholders
• Deep contact tracing solution for unclaimed processing using AI and new gen technology

CAMSPay

The company received the in-principle approval from RBI to operate as a Payment Aggregator in February 2023. The business is witnessing higher level of market growth thanks to the rapid strides made by UPI. CAMSPay is betting on UPI Autopay to ride this wave as compared to expanding on UPI since it is currently on a zero-commission model. CAMSPay growth has aligned with market trends on focussed segments with the introduction of new-age payment methods like UPI AutoPay, Paybylink, mobile app for seamless recurring payments and QR based payments.

Central Record Keeping Agency Services

CAMS CRA successfully launched NPS operations as a Central Record Keeping Agency (CRA) in March 2022. CAMS aim to build the best and forward-looking solution for partners and subscribers has led to many firsts in the industry. These include cloud hosting, comprehensive API stack for subscriber onboarding and servicing, multiple KYC options for registration, customised process flows to meet the business partners’ requirements. CAMSNPS platform for the PoPs and Corporates have been made operational. A complete bouquet of services and onboarding options are being offered.

Focus on ESG and CSR

During FY23, a Board level committee for overseeing the ESG initiatives of the company was formed, and the Board also approved the ESG Policy of the company. CAMS continued to focus on the areas of Education and Health care across the country as part of its CSR activities. It also continued its efforts towards the environment conservation.

CAMS also partnered with IIT – Madras for setting up and running three Rural Technology Centres in Tiruvallur District of Tamilnadu. The centres work with local high / higher secondary schools and colleges and the services are entirely free to the students. CAMS is also setting up the “CAMS - IIT (M) Fintech Innovation Lab (CIFIL)” – a world-class hub for research and applied technologies in financial technology. The initiative is part of the CAMS CSR initiative to focus on ushering innovation and unravelling unique possibilities in the Fintech space. Ms. Nirmala Sitharaman, Hon’ble Union Finance Minister, inaugurated the lab in December 2022.

Outlook

The MF and Alternatives industry has grown exponentially and is expected to continue the growth momentum due to declining attractiveness of hard assets and increasing preference of financial assets across customer segments. With international investors’ preference for India in Asian market and an enabling regulatory framework, the asset management industry is on a strong foundation to scale. As the leading platform and services partner to this segment we are prepared to support this growth. Momentum in the Account Aggregator arena will unfold as capital market players and the larger financial services segment onboard the platform and participants begin to derive business benefits. CAMSPay’s differentiated payment solution stack is tuned to payment needs of financial services industry. The company operating as financial technology infrastructure and offering niche technology products is well positioned to serve the larger capital markets and the BFSI segment and capitalise on these fast-growing sectors.

In conclusion

On this positive note, I thank all of you for the continued support and trust in the Company. I am grateful for the contribution and guidance provided by the Board to help us stride through this year of opportunity and honour our commitments to the various stakeholders we serve. CAMS has also benefited from the guidance and responsive support of the Regulators for which I am thankful.

The efforts of CAMS to enhance the technology-based solution offerings for the clients will continue. With our range of innovative and differentiated services and products, backed by powerful technological and digital support systems and a committed workforce, I remain confident of our ability to serve our clients and continue to create impact for them.

Sincerely,