We value Affle at 48x Mar'27 P/E to arrive at our TP of Rs2,200/sh. Our multiple is at a ~45% premium to the average PE of global adtech peers given Affle's higher growth expectations vs. the global adtech average. The premium multiple is justified in our view given Affle’s exposure to growth market/sub-segments and higher-than-average expected growth.

Risks that could impede Affle from reaching our target price include: (1) Affle pays for mobile ad inventory regardless of a user taking a revenue-generating action. If the company’s platforms fail to predict engagement, this could lead to lower profitability and cashflows. (2) The global ad-tech market is dominated by digital giants. These companies are able to invest more in R&D and sales and can respond faster to technological changes. This could lead to customers moving to competitors or demanding lower prices, causing revenue loss for Affle. (3) Over the last few years, the digital ad industry has seen disruptions from cookies depreciation (2024), Apple’s IDFA sharing limitations, and policies such as Europe’s GDPR, India’s DPDP, etc., which handle how user data is collected, stored, and processed. This affects the cost structures (cost of acquiring and storing data) and revenues (lower conversions) and could negatively impact Affle’s revenues.