Affle India – A flagbearer in Mobile Advertisements space
4 min read
Last week, we discussed Route Mobiles ltd and its unique business model that kept all the stakeholders happy. Today, let’s talk about another such company that got listed on the bourses in 2019 and since it has become the investor’s darling. Recently, only on the news of the stock split, the stock hit 5% upper circuit for 4 consecutive days.
But trust me, the caveat here is that the stock split was just an excuse as the real reason was the company’s glorifying 14-year history when blended with a unique business model, model that delivered profit right from the start and a business vertical that has seen major disruptions and will continue to see in near future thereby showing signs of sustainable future outlook.
The company that we are talking about is Affle India Limited. Affle India was founded by the two Anujs, Anuj Khanna Sohum and Anuj Kumar. Both come from different backgrounds. Formerly from a tech background while latter one from the marketing background but one thing that was common between them was Vision to start a company that lasts beyond their lifetimes.
However, like all other founders, the main question was the segment and the business model that they wish to build for their company. And, jeez, they hit the sweet spot. Mobile Marketing driven by tech intelligence is what they came up with and the rest is history. The founders saw it coming that whatever was done on PC including marketing will see its way into the mobile world. For them, Affle, simply means, “Affordable Mobile”.
Today, Affle India is mainly driven by 4 business models. First, Affle India delivers ads onto your mobile devices allowing enterprises to lure new customers. Secondly, with the help of its tech tools, it ensures that existing users are kept engaged thereby preparing the customers for repeat purchases. Third, it offers enterprises a unique platform called an online to offline marketing platform. A customer that leaves a digital footprint is picked up by Affle and converted into offline sales by delivering relevant advertisements about the offline presence of the brand so the customer can pick up products from nearby stores. Affle helps in delivering this. Lastly, it offers tools to curb online AdFrauds. It helps in detecting the AdFrauds and blocks them on a real-time basis. In the world of the internet, blocking adfrauds is a must.
Affle India also has a data management platform that abodes data related to transactions, apps, behavior, intent, and many more that can help enterprises to deliver perfect ads at a perfect time and in turn drive their sales.
These business models have not only proven to be successful on paper but have also lured many big investors to invest and helped the company deliver numbers. That is why, it is backed by famous tech investors biggest of all being Microsoft, D2C (An NTT DoCoMo). Even its institutional investor deck looks attractive with the likes of Nomura, Dolat Capital, Benett Coleman & Co. Ltd, Dalal & Broacha, and ICICI Securities to name a few.
Even on the numbers front, Affle India has been performing well. It has been delivering a compounded revenue growth of 45.7% in the last 4 years, compounded EBIDTA margin of 41.9%, and compounded PAT growth of 54.7% in the last 4 years. As of Mar21, its data management platform boasts about 2.2 billion connected devices that help in optimizing the delivery of advertisements.
And this doesn’t stop here as the prospect of mobile advertising looks very promising. As per Statista, mobile internet advertisement spends are going to increase from $276Bn in 2020 to a staggering $494.95Bn, a near 50% increase. This will help Affle to further enhance its stronghold in the market and one can see it all getting factored in the stock price.
The IPO was over-subscribed 86 times and its share price has touched ₹6,285 from the IPO levels of ₹750. It has seen a stellar run at the stock market and perhaps it will continue to do so looking at the business model and the mobile marketing segment it works in. In the end, what one can takeaway is that if a company is backed by sound promoters, unique but sustainable business model and a segment that still has room for penetration then there are very less factors left to be not successful on the bourses.
Until next time…
