Affle 3i Limited

Communication Services — Advertising Agencies · NSE

₹1,432.60+₹4.10 (+0.29%)

DalalBaazaar Score

74 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

The 60-second version of Affle 3i Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Affle 3i Limited, together with its subsidiaries, provides mobile advertisement services through information technology and software development services for mobiles in India.

IndustryAdvertising Agencies

SectorCommunication Services

Employees616

Annual revenue₹2,709 Cr

How does it make money?

Turns over ₹2,709 Cr a year. Of every ₹100 of sales, about ₹17 reaches shareholders as profit, with ₹25 left at the operating level before interest, tax and depreciation. Each of its 616 employees supports ₹4.40 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹4.40 Cr

Who are its competitors?

The closest listed comparisons in its industry are BHARTI AIRTEL LIMITED, VODAFONE IDEA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Some evidence

ROCE of 15.2% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE20.2%

What is the outlook?

12 analysts covering the stock expect revenue to grow about 19.6% and earnings to grow about 24.4% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+19.6%

Est. earnings growth+24.4%

Analysts12

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +89% while net margin moved -2% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+89%

Margin effect-2%

DalalBaazaar Score

74/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 42.3x is demanding — it needs sustained high growth to justify
✓ P/E is 34% below its own historical median of 63.9x — cheap by its own standards
✗ P/B of 5.51x is a steep premium to book

Quality vs. Valuation

Company Quality

80/ 100

Excellent

How good the business is, ignoring the share price entirely.

Valuation

42/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

42.3x

3Y Median

63.9x

40 monthly readings · mean 64.6x · range 44.3x–91.2x

Sector Median

21.7x

median of 2 sector peers

🟢Current valuation is approximately 34% below its 3y median of 63.9x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 95% above the peer median of 21.7x.

vs. its own history

Cheap

63.9x median over 40 months · -34%

vs. sector peers

Expensive

21.7x median of 2 peers · +95%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

27.8x

PEG

1.84

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 23.3% to 25.2% over 3 years.
Debt is being paid down
Total debt is down 86% over 3 years.
Cash generation is improving
Free cash flow is up 73% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 16.7% to 12.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 17.9% to 15.2% — often a sign of competition or overexpansion.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 23.3% to 25.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 86% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Priced below its own history
The stock trades 34% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹291 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

A premium to the sector to defend
It trades 95% above the peer median. That premium needs a reason that persists, or it closes.
Returns on shareholder capital are falling
ROE has dropped from 16.7% to 12.5%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Small Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 18% a year✓ 23.6% CAGR
Latest reported year was 20.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 23%✓ 25.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹291 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 12%✓ 15.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

6 good · 3 neutral · 2 weak

Market Cap

₹20,150 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

42.3x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.51x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹33.86

Profitable

Profitable on a per-share basis

ROE

12.5%

Moderate

Moderate capital efficiency

ROCE

15.2%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.41x

Low

Conservative leverage

Revenue Growth (YoY)

20.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

20.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹291 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

28.9x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

17.9%

Good

Healthy core-business profitability

Net Margin

16.8%

Good

Strong bottom-line conversion

Current Ratio

3.59

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.14

Defensive

Steadier than the market

52W Range Position

26%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1493.5 / 1576.8

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

24.1

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,433 Cr	₹1,842 Cr	₹2,265 Cr	₹2,709 Cr	+23.6%
EBITDA	₹334 Cr	₹404 Cr	₹540 Cr	₹682 Cr	+26.9%
EBITDA Margin	23.3%	21.9%	23.8%	25.2%	—
PAT (Net Profit)	₹245 Cr	₹297 Cr	₹382 Cr	₹455 Cr	+23.0%
EPS	₹18.36	₹21.91	₹27.19	₹32.32	+20.7%
ROE	16.7%	11.9%	13.0%	12.5%	—
ROCE	17.9%	12.9%	15.9%	15.2%	—
Total Debt	₹106 Cr	₹183 Cr	₹82 Cr	₹15 Cr	-48.1%
Free Cash Flow	₹168 Cr	₹147 Cr	₹266 Cr	₹291 Cr	+20.1%

🟢 Revenue has grown at 23.6% a year over 3 years.

🟢 EBITDA has grown at 26.9% a year over 3 years.

🟢 EBITDA Margin has risen from 23.3% to 25.2% over 3 years (+1.9 pts).

🟢 PAT (Net Profit) has grown at 23.0% a year over 3 years.

🟢 EPS has grown at 20.7% a year over 3 years.

🔴 ROE has fallen from 16.7% to 12.5% over 3 years (-4.2 pts).

🔴 ROCE has fallen from 17.9% to 15.2% over 3 years (-2.7 pts).

🟢 Total Debt has shrunk at 48.1% a year over 3 years.

🟢 Free Cash Flow has grown at 20.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,421 Cr

Total Liabilities

₹769 Cr

Cash & Equivalents

₹1,207 Cr

Operating Cash Flow

₹502 Cr

Capex

-₹211 Cr

Shareholding (proxy)

Institutional Holding

29.0%

Insider Holding

74.5%

Analyst Consensus

Recommendations

12 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,991.83

+39.0% vs CMP

Target Range

₹1,850 – ₹2,165

Peer Comparison

Company	P/E	ROE
BHARTI AIRTEL LIMITED	39.8x	20.2%
VODAFONE IDEA LIMITED	3.6x	—

Recent News

1 mixed5 general

AFFLE Forecast — Price Target — Prediction for 2027

TradingView, 26 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Affle 3i promoters revise disclosure on 54.91% share encumbrance

scanx.trade, 08 Oct

What Affle 3i Bears Saw Before The Fall

Simply Wall Street, 07 Oct

Affle 3i Share Price: Buy, Hold or Sell Guide

Univest, 02 Sept

Affle 3i Ltd is Rated Sell by MarketsMOJO

MarketsMojo, 13 Oct

Buy Affle 3i; target of Rs 2000: ICICI Securities

Moneycontrol.com, 11 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Risk

MiddlingProfitability

WeakValuation

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you.

All 5 tripwires holding · see Key things to watch ↑