Target: ₹2,000
CMP: ₹1,668.70
Affle 3i’s H1FY26 revenue grew about 19.3 per cent year on year to ₹1,270 crore, with CPCU-revenue up about 18.2 per cent (98.8 per cent of topline) and the rest from non-CPCU. Recent 20-22 per cent correction in stock price was mainly due to lower-than-estimated CPCU-revenue led by ad-budgets shifting to Q3 from Q2 in the US amid tariff-related uncertainty and partial RMG impact in India. Ahead, we expect the full 3 per cent RMG impact (₹17-18 crore/quarter) to playout in Q3 (and continue till H1FY27), partially offset by festival season in India and revival in developed markets (from 20.2 per cent in H1), as US marketing budgets ramp up. With the company optimistic of 18-20 per cent topline growth in near term (over 20 per cent thereafter) and post-correction valuation comfort, we upgrade our rating to BUY with an unrevised TP of ₹2,000 (valuing at 45x September 27e earnings). Near-term key trigger would be good inorganic acquisitions as the company has ₹1,460 crore net cash on its books (H1FY26).
Whilst we don’t expect any meaningful impact of Digital Personal Data Protection Rules 2025 (DPDP-2025) in the short term, a neutral-to-positive impact over the long term is likely, as the company is already ISO (data security) and Singapore’s stringent DPTM-certified (data privacy). These two form the strongest compliance combination in Asia and already cover majority requirements under India’s recent DPDP rules thus, enhancing trust, strengthening first party data credibility and providing strong differentiation in AdTech ecosystem.
Published on December 11, 2025
