Incorporated in 2008, CMS Info Systems Ltd (CMS) is India’s largest cash management company based on number of ATM points and number of pick up points. The company’s business includes installing, maintaining and managing assets and technology solutions on end-to-end outsourced basis for banks under long term contracts. CMS operates their business under 3 verticals, namely “Cash management services” which include end to end ATM replenishment services, “Managed Services” which includes banking, automation and “Other” which are in the nature of end-to-end financial card issuance and card personalization services. CMS has served more than 141,977 business points across their ATM cash management system, retail cash management and managed services businesses. The promoter of the company (having a pre-IPO 100% holding) is Sion Investment Holding Pte Ltd, which is an affiliate of Baring Private Equity Asia.
Objects of the issue:
The IPO proceeds shall be used towards the following purposes
- Carry out the offer for sale of up to 50.93 Mn shares
- Achieve benefits of listing the equity shares on the stock exchange
Investment Rationale:
Leading player with a Pan-India footprint
In the “Cash Management segment”, CMS is a market leader with over 66,000 ATMs, 43,000 retail pick up points and a massive 41% market share in the ATM cash management sector, as of FY21. In their “ATM Managed services”, they have an order book of over INR 15bn in Brown Level ATM solutions. On the other hand, they are also an emerging leader in “Tech Solutions” where they have an order book of 15,000 monitoring sites which is worth over INR 3.8bn. State Bank of India has been associated with CMS since FY14, has provided recurring revenue streams and expanded to 8+ solutions. As of FY21, CMS is remote monitoring 9520 ATMs, worth INR 217crs for them. CMS targets to replicate the same playbook with other private banks and public sector banks. The company has a network of 238 branches all over India and a fleet of 3965 cash vans . As of Aug’21, of the total number of ATM points their cash management business serviced, 22.4% were metro, 15.1% were semi-metro and 62.5% were semi-urban and rural, and in terms of geographic location, 23.5% were in the North of India, 26.5% were in the South, 17.6% were in the East and 32.3% were in the West. In addition, as of Aug’21, of the total number of retail pick-up points their cash management business serviced, 33.% were metro, 16.7% were semi-metro and 50.3% were semi-urban and rural, and in terms of geographic location, 26% were in the North of India, 30.4% were in the South, 13% were in the East and 30.6% were in the West
