Affle India shares hit 52-week high as Citi initiates with 'buy', forecasts 17% upside

Affle India shares have risen 26.5 percent in the last three months.

Shares of Affle India Limited rallied 9.4 percent to hit a new 52-week high of Rs 1,465 in morning trade on July 9, extending gains for the second session in a row, after Citi initiated coverage with a 'buy' rating citing robust growth prospects.

At about 9:45 am, shares of the company were trading at Rs 1,425, up 6.3 percent from the last close on the NSE. Affle India shares have risen 26.5 percent in the last three months.

Analysts at Citi have assigned a target price of Rs 1,600 per share, implying an upside potential of 17 percent from the current market levels. Affle India provides mobile advertisement services through information technology and software development.

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The brokerage said that the company is positively leveraged to digital ad spending and is well-positioned to benefit from the recovery in mobile ad budgets.

Furthermore, its return on equity (RoE)-focused M&A strategy should drive a business turnaround in major developed markets like the US. "We expect a 20 percent CAGR (compounded annual growth rate) in topline over FY24-27 and a 400 bps expansion in EBIT margins during this period," Citi added.

The company reported a 40 percent year-on-year increase in consolidated net profit for the March quarter (Q4FY24) at Rs 87.5 crore, up from Rs 62 crore in the same period last year. Sequentially, the net profit rose 14 percent from Rs 76.8 crore in the December quarter.

The company's revenue from operations surged by 42 percent to Rs 506 crore in Q4FY24 as compared to Rs 356 crore a year ago. For FY24, the company's net profit rose to 21.5 percent to Rs 297 crore, compared to Rs 244.58 crore reported at the end of FY23.

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