By Ks Badri Narayanan
Target: 570
CMP: ₹519.55
One of the biggest challenges for CMS Info Systems in FY25 was that the execution of the service portion of its managed services vertical was impacted, due to delays in pre-deployment testing, and disruptions at a large industry player. However, we understand that service execution has started picking up now.
While most issues are now resolved, CMSINFO is expected to be in a comfortable position by Q2-FY26. Most wins last year were from PSU banks, wherein execution has picked up; and in private sector banks, execution is panning out as usual. Further, on the remote monitoring front, execution has also begun on the recently won order from a quick commerce player for its dark stores, with completion targeted by Q3-FY26.
In FY25, CMS Info’s cash management business was impacted owing to elections and a weak macro and, consequently, growth was muted at 8 per centy-o-y in FY25. However, some improvement is expected in this quarter, and the company seems to be on track to achieve its guidance of 10 per cent y-o-y growth in this vertical.
Incrementally, industry-wide challenges caused by the disruption at a major peer have largely been addressed. We revise our FY26-28E EPS estimates by 1-2.6 per cent, and maintain Buy with a target price of ₹570 (₹550 earlier).
Published on July 7, 2025