Questions across 4 calls

Ram Charan

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Computer Age Management Services Limited

Computer Age Management Services Limited CC-May26.pdf · 2026-05-05

Thanks, Abhijit. 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. So if you look at just the numbers, right, if you see from last year to this year, while the company strength may have grown by around 100, 120 people, we have achieved this entire 11 percentage growth with -- you will see a reduction in the core MF operations, right? There is a reduction in the core MF operations. Obviously, some investment has happened for rearch, some investment happened for risk and compliance, etc. That's kind of contributing to the small increase in headcount. And you will see over the course of the year, there is no operational impact for any of these things, right? So which means we continue to get industry -leading statistics in terms of compliance risk, et c. So there is not a onetime squeeze that we have done of everything, and it 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. And next year, again, Anuj laid out the targets saying that you're going to see further kind of optimization that's going to happen as we get more a nd more of this rearch platform AI embedded into the operation system. So this is, in our mind, a very sustainable kind of cost levels. We are not saying there will be 0 addition of cost. Obviously, that's not going to happen. But I think we will try to keep this to the minimum without impacting, obviously, day-to-day operations, etc., which we have successfully done rather say below the radar in the last year without making a big show about it. We will continue to do that in the next year also. So I don' t think you need to have any worry from a cost sustainability perspective. 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 for us to kind of say a separa te profit line and the cost line for this is actually not so material, given that it's less than 10% of my overall AUM. Now from a yield perspective, I think the rates that we have for ETFs are extremely low by -- it's nothing to do with AMC suffering mor e than us, et c. It's extremely low. The yields for passives by nature are extremely low. I don't think there's any room for us to kind of have any renegotiation on that given that it's actually at really low levels now. So as the passive increase, there will be some impact on the mix and there will be some impact on the yield, but it will 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 in any o f 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 percentage. So I d on't see this being a big cause of concern going forward also.

No, absolutely. That's one of the points that we will pick up in terms of yield decline saying that the mix is also unfavorable to us. But we should also be cognizant of the fact that the other side, this has a similar impact on the AMCs too. So I think this will be one of the things that we'll binge across, but I don't know whether that will be the only argument in which we'll have or had some.

Computer Age Management Services Limited CC-Aug25.pdf · 2025-07-31

The only one question that was on the profitability of non-MF and MF. I think they continue to be on what we used to be. The non -MF profitability, we said it's always between 10 and 15 percentage. They were a little lower on this 12% probably in the current quarter. MF continues to be 45-plus percentage. So that's the split up on MF, non-MF, probably a little lesser this time. Keep in mind the overall company margins are a little lesser, but nothing that's swung it either way.

Yes, yes, that's correct.

Computer Age Management Services Limited CC-Dec24.pdf · 2025-01-30

So Abhijeet, the way we look at it, the long-term compression of yields, if you see over a longer brand I don't think 1 or 2 quarters will do justice to it, is to actually look at it at a number closer to 3% to 3.5%, right? So that's been the long -term range in terms of the yield’s compression. What we feel is that the 3.5% might not hold good going forward, at least for the next year. And so for the reasons Anuj mentioned, that there could be some pressure on it subsequently, whether it will be double of this, unlikely. But that could be something that is higher than that. As I said, the impact will have to be assessed after we do it. So we don't want to give a better or worse picture than what it is going to be finally. But as Anuj said, we should not read more than what it is intended to be, which is our guidance to you, saying that if you're building your models using the usual yield depletion, please add something to it so that it becomes more accurate. So it will not be double of what it is now, it's not going to be a depletion like that, but it's definitely going to be higher than the 3.5% that we are seeing historically to be the year in depletion.

Sure. So Abhijeet, you would have seen that during the current quarter on a quarter-on-quarter basis, the expense growth was a little muted, right, especially on the salary cost. This is after considering the talent infusion that's happened in terms of the IIT, IIMs and other senior hires that we've done. So what we expect overall is -- there are three things I'll split it into, the employee costs, the operating expenses and the fixed cost. From an employee perspective, we've seen it to be stable around 32% to 33% of revenue. So barring this one quarter in April, May, June, where there could be some increase because of the annual appraisal impact, it has traditionally been around 2% of revenue. Apart from that, we don't see that to be very different. I think we have a fully staffed organization. Whatever we do in terms of talent diffusion will continue to happen. But I don't think it's going to be significantly increasing the cost by 4%, 5%. At most, it would be a couple of percentage increase there. But I think you'll see remarkably stable operating expenses. It has traditionally been if you take away the OP, it's traditionally be around 8% to 8.5% of the revenue, be it the sponsored bank charges for payments or the data entry charges for CAMS or for software-related direct expenses that we're incurring. So we don't see any change in that ratio too. And fixed expenses, it just goes with inflation. So the short answer is, I think in the next quarter, we see very stable expense. We've been around the INR195 crores, INR196 crores other than depreciation at the total quarterly expenses. You can say you'll see probably a couple of crores of increase in expenses, but we see a stable expense base. And the year after, barring the salary increase that we see, we don't see a big expense in the opex part of it. The capex, will continue to make investments in terms of the Rearc, in terms of the other compliances that we need to do for SEBI purposes or for IT infra purposes. But from opex perspective, in spite of continuing to invest in talent and in spite of buying the latest cybersecurity tools, etcetera, we continue to invest in, we don't see a significant change in the cost base. It will be probably driven by the factors that I mentioned earlier.

Computer Age Management Services Limited CC-Sep24.pdf · 2024-10-29

Yes. Prayesh, on the question on your question on the breakup of non -MF margins. So we've actually said that it has been creeping up over the last few quarters. And this trend continues in the current quarter. We have a non-MF margins. We said it was around 15%. So it's gone up to closer to 19% this time. Obviously, on the back of good growth on pay and the KRA, right? So this is again on a higher trend. We liste n to your feedback on publishing these numbers, we'll have a look at it and probably next quarter, we'll have -- we'll kind of do something.

Yes. So I think your question was more on the non-salary expenses and how they are variable. So I'll just split into two. If you see there is an operating expenses that we incur, which is more variable in nature. So traditionally, if you take away the out -of-pocket expenses or the reimbursed expenses, that is around 8% to 8.5% of the overall revenue. And that has been the -- our experience and trend over the last few years. So we don't see that changing a lot, especially given that we are into cloud for the new businesses, and which are ramping up and the bank charges that we need to pay for the ECS and the UPI Autopay stuff. So that kind of relationship continues to hold, and we don't see any reason why that will break in the future, which is operating expenses being around 8% to 8.5% of revenue. The other expenses is a fixed cost. And I think over the last few quarters, we've been around INR25 crores to INR28 crores of absolute numbers during a quarter, which was around INR21 crores, INR22 crores in the last quarter. So you will continue to see inflation-led expenses, the AMCs that we continue to pay, the rent increases that we continue to incur. Last time, as I was mentioning, there is some one -off expenses for a couple of crores in these INR28 crores that we have. But again, some of the expenses have a habit of repeating as a different one-off expense in different quarters. So I wouldn't read too much into it, except that these are stabilizing around INR25 crores to INR30 crores of other expenses and 8% of operating expenses.