CAMS, Kalpataru Projects: 2 stocks on Kotak Securities' radar for near term

Shrikant Chouhan of Kotak Securities has shared a bullish view on two stocks - CAMS Ltd and Kalpataru Projects International.

Disclaimer: This article is written by Shrikant Chouhan, head of equity research, Kotak Securities. Views expressed are his own. Readers' discretion is advised.

 

CAMS Ltd: Add 

 

CMP: ₹784

 

Fair value: ₹860

 

Resistance: ₹790-810 | Support: ₹760-740

 

Computer Age Management Services (CAMS) is India’s largest technology-driven financial infrastructure and services provider, primarily serving the mutual fund industry. Established in 1988, the company operates as a premier Registrar and Transfer Agent (RTA), managing a dominant market share of about 68 per cent of India’s mutual fund assets under management (AUM), with odd 200+ registered Mutual Funds in India as of March 2025, with mostly all the big names under naming few like HDFC AMC, SBI AMC, and ICICI AMC. Beyond mutual funds, CAMS has diversified its digital offerings into insurance repository services, alternative investment funds (AIFs), wealth management technology, and KYC compliance through its subsidiary, and provides services such as digital onboarding services, AML services, transaction processing, record management, fund accounting and reporting, and reconciliation and creation of MIS and reporting systems.

 

 

Apart from being the biggest RTA, it is also the largest insurance repository with a large presence in GIFT City, with 55 per cent penetration in tier 2 and tier 3 cities. CAMS’s 1QFY27 results were ahead of expectations, as core earnings grew 19 per cent Y-o-Y, led by 9 per cent growth in MF-based and 28 per cent growth in non-MF revenues and lower-than-expected expense growth. MF RTA yields remained broadly stable Q-o-Q at 2.09 bps despite a reduction in TER, and Management remains confident of retaining stable yields in this segment. Non-MF revenues grew 28 per cent Y-o-Y and (-)3 per cent Q-o-Q, above management guidance of 20 per cent growth in this segment. Payment aggregator’s (CAMS Pay) revenues are up ~70 per cent Y-o-Y (~13 per cent Q-o-Q). The non-MF margin fell to 13 per cent in 1Q (from ~17 per cent), driven by KRA, but is guided back to ~17 per cent by the end of the quarter. CHECK Stock Market LIVE Updates

 

Kalpataru Projects International (KPIL): Buy

 

CMP: ₹1,400

 

Fair value: ₹1,710

 

Resistance: ₹1,430-1,460 | Support: ₹1,375-1,355

 

Kalpataru Projects International (KPIL) is one of India’s leading EPC companies, with a diversified presence across Power Transmission & Distribution (T&D), Buildings & Factories (B&F), Water Supply & Irrigation, Oil & Gas, and other infrastructure segments. The company closed Q1FY27 with its highest-ever order book of ~₹66,600 crore, providing ~2.5 years of revenue visibility, including L1 orders. Its order book remains well diversified across businesses, clients and geographies. KPIL has secured Y-T-D FY27 order inflows of ₹7,670 crore, along with an L1 position in projects worth ~₹7,500 crore, taking secured/L1 visibility to ~₹15,000 crore. Management has reaffirmed FY27 guidance, targeting at least 15 per cent annualised revenue growth, order inflows of ~₹30,000 crore, 75bps+ improvement in PBT margins, and working capital below 100 days.

 

The order pipeline remains robust, particularly across domestic and international T&D, including HVDC and GIS projects, B&F opportunities such as data centers and industrial capex, Middle East Oil & Gas, and international water projects. India’s T&D market alone offers an annual addressable opportunity of ₹1-1.25 trillion over the next five years, including 1-2 HVDC projects annually. With only a limited number of EPC players capable of executing large, complex T&D projects, KPIL is well positioned to benefit. Further, grid-capacity constraints across Europe, the Middle East and South America are creating additional international opportunities.

 

KPIL delivered a strong Q1FY27 performance, with like-for-like consolidated revenue rising 9 per cent Y-o-Y despite election-related labour shortages and Middle East supply-chain disruptions. Consolidated PBT increased 45 per cent Y-o-Y to ~₹420 crore, supported by resilient execution, margin expansion, higher other income and lower interest costs. The balance sheet remained healthy, with net debt/equity at 0.1x, RoCE at 21-22 per cent, and net working capital improving to 80 days from 91 days Y-o-Y. We estimate 17 per cent revenue CAGR over FY26-29E, led by T&D and B&F. We retain Buy with an SoTP-based fair value of ₹1,710, valuing the standalone business at 15x two-year forward EPS. Key near-term monitorable: impact of Middle East tensions on execution and profitability.