Affle India

Mobile marketing company, Affle India IPO will open for subscription on July 29 . Affle India has raised ~ Rs 206.55 crore from 15 anchor investors by allotting 27,72,483 equity shares at a price of Rs 745.  Affle India IPO amounting to Rs. 459 crore has fixed a price band of Rs 740-745 per share. Affle India, is part of Singapore-based Affle Holdings, in which Microsoft stake is 6.48%. Affle India has also the backing of investors like Ascent Capital, NGP Capital and Inventus Capital Partners.

Affle India IPO Details

Issue PeriodJuly 29, 2019 to  July 31, 2019
Issue DetailsFresh Issue upto Rs.90 Cr
 + Offer for Sale of upto 4,953,020 Equity Shares
Issue Size (Rs. Cr) Rs.459 Cr
Price BandRs.740 – 745
Bid Lot20 Equity Shares 
Issue Structure : 
QIB75% of the offer
NIB15% of the offer
Retail10% of the offer -616,107 Equity Shares – Rs.46 Cr
BRLMsICICI Securities, Nomura Financial
RegistrarKarvy Fintech Pvt Ltd

About Affle India

  • Affle (India) Limited is a global technology company engaged in mobile marketing platforms.
  • Affle India has two business segments: consumer platform and enterprise platform.
  • company’s consumer platform primarily provides the services: like new consumer acquisitions, engagements, transactions through mobile advertising, targeting existing consumers to complete transactions for e-commerce companies , an online to offline (O2O) platform that converts online consumer engagement into in-store walk-ins.
  • Affle India’s enterprise platform provides end-to-end solutions for enterprises to enhance their engagement with mobile users.
  • Affle’s consumer platform had ~2.02 billion consumer profiles and has accumulated over 300 billion data points in the last one year (on March 31, 2019)

Affle India : Financials

Rs. in crore/yearfy19(con)fy19fy18fy17
Revenue 249.4117.7983.7665.63
EBITDA70.3124.7516.773.52
EBITDA (%)~28.20%21.01%20.02%5.36%
Profot Bef tax59.823.5413.60.8
PAT48.8216.688.830.33
Net Profit margin19.57%14.16%10.54%0.50%
Share Capital24.2924.2924.2924.29
Reserves48.1221.985.88-3.26
Net worth72.4146.2730.1721.03
RONW(%)67.40%36.05%29.28%1.57%
NAV29.8119.0512.428.66
FV10   
EPS (Rs.)20.16.873.640.14
IPO Price745   
post issue equity25.5
EPS post issue 20.1
PE Post issue37.06

Affle India IPO: Assessment

  • Affle India is part of Singapore-based Affle Holdings, in which Microsoft has a stake of 6.48 per cent stake. Other investors include Ascent Capital, NGP Capital and Inventus Capital Partners.
  • E-commerce comprised one-tenth of the total global retail sales at USD 2.29 trillion (Source: eMarketer 2017), with about a fifth of this contribution coming from the United States.
  • 70% of company’s revenues come from global markets which also makes it vulnerable to FE fluctuations.
  • Regulatory developments regarding data protection could adversely affect Affle India’s ability to conduct its business
  • Affle India Consumer Intelligence Driven Mobile Marketing Platform has a leading position in India; it is considered a high growth market with substantial barriers to entry.
  • Affle India has a low-cost business model built on an asset light, automated and scalable platform
  • Post issue promoters shareholding will stand at 68.38 %.
  • Affle (India) raisedRs 206.55 crore from 15 anchor investorswhich include names like Abeerden Asian Smaller Companies Investment , Franklin Templeton Investment Funds etc.
  • IPO is small size with only 10% being offed to Retail Investors.
  • Even as the scrip is not offed cheap, Affle India looks promising considering its good growth in the past and strong prospects in the segment in which it operates.
  • Affle India IPO is commanding a small GMP, a subject to allotment application price of Rs. 200 and a kostak of ~ Rs. 250.
  • I am likely to apply for this IPO on Day 3 and will keep an eye on subscription figures of QIBs to the IPO.

Standard disclaimer:  I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering and Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2)  Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors.  I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or  leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.