Affle (India) IPO: From business to valuation, all you need to know about the company

Affle (India) IPO: In a bid to raise working capital and increase brand visibility in the public domain, Affle (India) Ltd. launched it's Initial Public Offering (IPO) today. The ad technology service provider and marketing company aiming to raise around Rs 460 crore from its IPO (Rs 90 crore through fresh equities and Rs 369 crore via offer-for-sale from its IPO. Affle Holdings Private Limited, which holds around 75 per cent shares in the company, has offered 49.53 lakh shares in the sale. As per the Axis Capital estimates, Affle Holdings share in the company after this sale offer would decline to around 53 per cent.

Informing about the current performance of Affle (India) IPO, the company informed that it has raised around Rs 226 crore from anchor investors. Some institutional investors have also shown interest in the IPO which includes Franklin Templeton, Goldman Sachs, Reliance Capital, Aberdeen, Aditya Birla Sunlife etc. The price band of the Affle (India) IPO is Rs 740-745 that values company to the tune of around Rs 1,900 crore. After listing off the Affle (India) IPO today, its promoters share in the company declined from 92 per cent to around 68 per cent. 

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For information to the investors, Affle (India) deals in two segments — enterprise platform and consumer platform. Its consumer platform generates around 97 per cent of its revenue while its entreprise platform provides an end-to-end solution to the enterprises by enhancing their engagement with mobile users. 

On financials, the Affle (India) Q4FY19 results reported a net worth of Rs 72.4 crore with its gross debt standing at Rs 9 crore. Its cash, cash equivalents and other bank balances stood at Rs 30.4 crore in Q4FY19.

However, there is some risk factor involved with the Affle (India) IPO as well. Out of net earnings of the company, around 65 per cent comes from 10 clients while 22 per cent of the net earnings come from a single client. Share market experts say its inability to compete in highly competitive market is one of its major limitations that needs an urgent address by the company.