Affle India - India Mobile Internet Advertising Leader

New IPO with current market capitalization of Rs2816crs. Promoter holding is 68.38%. Main public shareholders as below.

Affle India Limited is a Mumbai based company engaged in the business of mobile marketing with its digital platforms. The company offers a consumer and an enterprise platforms to its clients. With these products company tries to improve the ROI on digital marketing campaigns for clients, reduce the ad frauds, maintaining consumer privacy and more.

Affle India was initially incorporated as “Tejus Securities Private Limited” in 1994. It was then subsequently converted to a public limited company on July 13th 2018 and the name was changed to ‘Affle (India) Limited’

Affle Consumer Platform’s had approximately 2.02 billion consumer profiles as at March 31, 2019 of which approximately 571 million were in India, 582 million were in Other Emerging Markets (which comprises Southeast Asia, the Middle East, Africa, and others) and 867 million were in Developed Markets (which comprises North America, Europe, Japan, Korea, and Australia). During Fiscal 2019, the Affle Consumer Platform accumulated over 300 billion data points, which power their prediction and recommendation algorithm.

New IPO which listed on August 8, 2019

Promoters of the company
Anuj Khanna Sohum and Affle Holdings are the joint promoters of the company

How They Earn Revenue?
a) They Primarily earn revenue from their Consumer Platform on a cost per converted user (“ CPCU ”) basis, which comprises user conversions based on consumer acquisition and transaction models. The transaction model is usually in the form of a targeted user submitting a lead acquisition form or purchasing a product or service after seeing an advertisement delivered by the Affle .

b) They also earn revenue from their Consumer Platform through awareness and engagement type advertising, which comprises cost per thousand impressions (“CPM”), cost per view (“CPV”) and cost per click (“CPC”) models.

Industry they serve
Their products are used in e-commerce, fin-tech , telecom , media , retail and FMCG companies, both directly and indirectly through their advertising agencies

Asset Light Model
Their Consumer Platform business is asset-light and scalable as shown by the fact that company’s employee benefit expenses, depreciation and amortization expenses, and other expenses have remained relatively unchanged despite significant changes in our revenue in the last three fiscal years.

Other facts
The company has acquired two subsidiaries in 2018-19 that is why Consolidated Financials have been prepared for this year.
The Company unlike tech startups not burning investors money but generating free cash which is a healthy sign for the business

Key Risks
If our ability to collect significant amounts of data from various sources is restricted by consumer choice, restrictions imposed by customers, publishers and browsers or other software developers, or changes in technology it may have a material adverse effect on our business, results of operations, cash flows and financial condition.

Regulatory, legislative or self-regulatory developments regarding data protection could adversely affect our ability to conduct our business.

If we fail to predict an engagement by consumers with mobile ads with a sufficient degree of accuracy, it could have a material adverse effect on business, results of operations, cash flows and financial condition.

The market in which we participate is intensely competitive and we may not be able to compete successfully with our current or future competitors. Although it is dominated by digital giants such as Google and Facebook, there are over a hundred companies around the world who offer one or more components of this solution. However, only a few companies/groups operate internationally, including, among others, us, InMobi, Criteo,
Tradedesk, Freakout, Mobvista and YouAppi.

If we are unable to protect our proprietary information or other intellectual property, our business, results of operations, cash flows and financial condition could be adversely affected.


Financials Consolidated for FY19



India is famous for window shopping

My main worry is scalability of business as in India internet surfers really buying that frequently and that too big amount ?

Here is from company’s DRHP

Capturing India : India with its rapidly growing Internet user base has become an attractive destination for international ad tech vendors, including Criteo, Mobvista, FreakOut – who have set up recently, alongside existing companies such as Affle, RevX, InMobi, among others.
However, India presents its unique set of challenges such as a disjointed demographic which is just getting habituated to digital applications (such as use of e-commerce, digital payments, etc.). Only 10% of Internet users are active (i.e., making a purchase at least once per month) e-commerce customers. Frost & Sullivan believes that this makes it a more challenging landscape for marketing tech to be able to discern the users who have the highest propensity to transact online. It can be a hard market to sustain, even for market participants who are globally successful.
With an average CPC at USD 0.1 to 0.3, the price points are quite low compared to the global market.
Frost & Sullivan believes that achieving profitability in such a price-sensitive market is possible only for companies that are familiar with the dynamics of consumer profiles and have a track-record of working alongside brands locally for years. Ad tech, while being extremely attractive, hinges on the success of data acquisition and several vendors globally have demonstrated low profitability or losses even in high CPC markets. Frost & Sullivan believes that India, with its constraints of low CPC, inadequate availability of data and technology will pose significant challenges for scalability and growth, even for established international companies. "



While the company has a good line of business of selling online inventory to advertisers, it needs to be seen if they can sustain and thrive. Currently most of the online ad market is dominated by Google, Facebook/IG, and smaller players like Bing/Yahoo, Flipkart, Times Internet etc. The competition in the market is cut throat, and there’s hardly any differentiation between different offerings except pricing. Another company, Vertoz Advertising, in similar space listed in 2017. After the initial volumes, liquidity has all but dried up. Discl. Not invested.

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Story looks good from many perspectives.
But according to me there is a 10:1 risk to reward ratio in favour of risk.
It has all to do with technology and tech giants google facebook microsoft amazon and others why let affle to grow at any larger scale.??
Upto some extent they will let it to play but when they see any large value they will easily kill this puppy.
I dont find any moat to the business.

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If they find value in Affle they might chose to buy out the business in which the minority investor would also benefit.

Why do you assume everyone wants to do everything. For example with its money Reliance Industries can kill companies across the board in all SME industries. Why does it go after a few selected businesses only?

Going by your logic no entrepreneur should set up any business because some big business will anyway kill it right.


If you see business model of Affle, they work with free App players to run the advertisements from their Ad inventory on the app(This app can be like Moneycontrol like app who do not charge for their free service) as it gives revenue generation opportunity to the app player. When the user clicks and does the intended action( e.g. if the advertise is for downloading a particular application like Alt-Balaji- They did run campaign for Alt-Balaji-Source DRHP) then Affle will receive the revenue from that transaction if and only if the user clicks and downloads the app(Alt-Balaji)

Here many players in the mobile advertising try to focus on user clicks wherein Affle gives a model where the Advertiser(Monecontrol) will get be benefited as well as the Ad owner(Alt-Balaji) along with Affle. Here the main point is how the Affle shows the relevant advertise on the mobile device, as they should have correct profiling of the owner of that mobile so that they can showcase a more relevant advertise to him that catches his attention and he does the necessary action.

Here players like Google/Youtube are more acting as a partners and not competitors.

Disc: Have a tracking position


@vnktshb sir
In affles case it has to work on this tech giants platform. It has to use facebook google and amazons services at every point.
So you have to give an example where any SME which is using RIL’S by products or services and creat huge profit from it.
As per my knowledge non of the company grown.

Disc.:- not invested

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One of the biggest clients of Affles India is Amazon India btw. One of the larger investors in Affles Holdings which is holding company of Affles India is Microsoft.


Folks need not worry about it being a commoditised business yet. Please wait and watch for the next few quarters at least. It provides highly customised solution and recognises revenue when clients benefit. It is not just another plain vanilla programmatic online ad company. Meanwhile retail holding decline substantially. As per the latest SHP small holders declined from 31k to 7.6k.


The listing ceremony of Affle, attended by many Board members and anchor investors from different countries provides many details about the company in its easier days, a good watch. Here is the link
Disclosure: Invested

confident mgmt

Malabar invested pre ipo in ipo and on listing in Affle

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HDFC Sec has recommended Affle in its Diwal picks Samvat 2076 due to its asset light and scalable business model.

Dislosure: Invested and largest holding in my PF

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Hi All,

While the growth in stock price post IPO has been phenomenal, I am not sure if the members in the thread understand the underlying business model and if there is a tech differentiation. Affle mainstay business is on the affiliate side and doesnt have any clear tech differentiation or buying power over advertisers. Google/FB is not a right comparison. Please compare the business with other chinese players like Mobvista/YeahMobi. They do not have a SDK inventory. While their remarketing and exchange business is interesting , it is still nascent and not sure if profitable.


The price appreciation in the stock price is due the profit growth between last year and this year. Many people are getting attracted due to its profit growth and will be disappointed if they don’t get the same growth this quarter.

Word of caution here. Be wary of any company that uses machine learning, artificial intelligence and deep learning excessively in a document. I got skeptical and decided to dig further and took a at linkedin on their employees. Though the company claims 187 employees and 81 of them “full time members in research team” - I did not find a single such tech profile worthy of being in such a team, leave alone lead one or build such products. Most of these employees in the “data operations” or anything related to “data” have no such relevant experience and the few (can count on single hand) that even mention such experience are very inexperienced and have joined only in the last year. Most of the employees appear to have joined in the last year or two. Where are the geeks that built their products? A product company such as this with claims as high ought to be screaming with talent that has stayed on for years, which is shockingly absent going by linkedin. None of the employees they claim to have in Singapore & Indonesia are on LinkedIn? What such product company doesn’t have ESOPs, for eg.?

They keep comparing themselves to InMobi which is in different league altogether, nearing $1 billion in revenues. What’s interesting though is that InMobi with its billion dollar valuation couple of years back was still not profitable. So this doesn’t appear to be an easy business to be in, in general but somehow Affle is reporting some mindboggling growth. Neither is the claims of cost-per-click being traditional true. I remember affiliate marketing would routinely use CPD (cost per download) and cost-per-conversion (an order usually) to prevent gaming of clicks. Why would someone utter something so blatantly untrue?

51% of their revenue is in Indonesia. Will this money ever get to Indian shareholders to pay a dividend? Can we trust the cash in Indonesia when its not audited by Indian auditors? (8k Miles anybody?). Then the final question - why doesn’t a company thats growing so fast and is claiming its going to be more profitable in a field that brings VC money by the sackful, not seek it and instead decide to list itself in the public markets? Another interesting thing to mull is that InMobi is at a $1 billion valuation (7000 Cr) while Affle which makes about 4% of InMobi’s topline is already valued at 50% of InMobi? 3600 Cr mcap as of today, or roughly 15x sales! Nothing makes sense here. Right?


My 2 cents…

i) (please correct me If I am wrong)Their moat is not really a great moat IMO, given the same data points is available to others. So, someone can easily do the same thing & may be better.

ii) World is coming to terms with data & privacy after Cambridge Analytica scandal. Likes of matured organisations like Facebook are being penalised to the tune of 5bn in data privacy related cases. The company’s business model continuously challenges the fundamental right to privacy. So, all could be great one day & change completely next day in some geography/country. A company like Facebook could handle such things but its going to be hard for a new player. They have to be careful, adhere to compliance & adaptable to the changing market & governance. This is a risk for any relatively new player.

iii) Not a mature enough organisation yet - Top 10 client contribute 72%+. 3 of their key business areas are acquired in last year or so. For a product company, their linked in page last few months is all about IPO related news or videos of CEO speaking to the news. I would like to see their products doing the talking.

They have not yet produced 1 quarter result or management updated on a quarter results to investors or analyst. While, I completely agree they have something really good on their hands , I will play the cynic for now and watch from the sidelines for few quarters. This is not a IRCTC which has monopoly. But then , reality is, Stock has already doubled.For now, I have to respect Mr Market.


Will try to answer the same with my limited knowledge. Other members can contribute. The points here is to use those data points to show the relevant ads so that the user gets attracted to do the desired action. Here profiling of the user is important to show him the ads which will matter to him e.g. if the user is browsing then it is relevant to show him the ad of a low cost trading platform rather than showing the ad of other company.

Here I would like to mention about the patent the Affle is holding. They have created a platform wherein they will be able to collect the relevant information adhering to the privacy regulations. This is my understanding of the process. Others can comment on the same.

@phreakv6 can you please confirm the source of the same as I could not find that data?

From their corporate presentation July 2019 -