Buy Affle India; target of Rs 3300: Dolat Capital Market

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Dolat Capital Market's research report on Affle India

Affle India is behavioral analytics led contextual advertising technology company operating in high-growth Mobile Advertising industry powered with a ROI-centric customer acquisition model. Affle is well placed to capture growth from increasing smartphone penetration and velocity of ecommerce transactions that would drive shift towards mobile based digital advertising in emerging markets. The Tech stack, breadth of product portfolio, exclusive access on select OEM devices (although not contractually) and booming vernacular & Omni channel capabilities via acquisition brings more capability to capture opportunities within Digital spends. Affle is rightly positioned in the highly-populated but moderately-penetrated market (India-Indonesia) with an early mover advantage in Digital Ads. We believe Affle India offers a unique interplay of Digital + Mobility + Analytics theme that can offer multi-year-high-growth opportunity.

Outlook

We believe it can sustain/accelerate its current growth momentum and thus we model in revenue/EPS CAGR of 26%/27% over FY20-25E with a Buy rating and DCF based TP of Rs3,300 (implies ~59x FY23E earnings – 2.2x on PEG basis).

For all recommendations report, click here

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