Current Rating and Its Significance
MarketsMOJO currently assigns Affle 3i Ltd a 'Sell' rating, indicating a cautious stance towards the stock. This rating suggests that investors should consider reducing exposure or avoiding new purchases at present, based on a comprehensive evaluation of the company's quality, valuation, financial trends, and technical indicators. The 'Sell' recommendation is a reflection of the stock's risk-reward profile as it stands today, rather than solely the circumstances at the time of the rating update in December 2025.
Quality Assessment
As of 05 February 2026, Affle 3i Ltd maintains a good quality grade. This assessment is supported by a return on equity (ROE) of 12.9%, which indicates the company is generating reasonable profits relative to shareholder equity. A solid ROE is a positive sign of operational efficiency and management effectiveness. Despite this, the quality grade alone is not sufficient to offset other concerns that influence the overall rating.
Valuation Considerations
The stock is currently classified as very expensive in valuation terms. Affle 3i Ltd trades at a price-to-book (P/B) ratio of 7.1, which is significantly higher than typical industry averages and historical norms for its sector. This premium valuation suggests that the market has priced in substantial growth expectations. However, such a high valuation also raises concerns about limited upside potential and increased downside risk if growth disappoints or market sentiment shifts.
Financial Trend Analysis
Financially, the company shows a positive trend. Over the past year, profits have risen by 19.7%, signalling robust earnings growth. The stock has delivered a 9.99% return over the same period, reflecting some alignment between earnings performance and market returns. However, the price-earnings-to-growth (PEG) ratio stands at 2.7, which is on the higher side, indicating that the stock’s price growth may be outpacing earnings growth. This elevated PEG ratio tempers enthusiasm, as it implies the stock may be overvalued relative to its growth prospects.
Technical Outlook
From a technical perspective, the stock is currently rated bearish. Recent price movements show a decline of 1.9% on the latest trading day, with a one-month return of -10.93% and a three-month return of -11.55%. These negative short-term trends suggest weakening momentum and potential resistance levels that could limit near-term gains. The bearish technical grade reinforces the cautious stance reflected in the 'Sell' rating.
Stock Performance Snapshot
As of 05 February 2026, Affle 3i Ltd’s stock returns present a mixed picture. While the one-year return is slightly negative at -1.63%, the stock has shown some resilience with a positive one-week return of 5.67%. Year-to-date, however, the stock has declined by 9.84%, indicating volatility and uncertainty in the current market environment. These fluctuations underscore the importance of considering both fundamental and technical factors when evaluating the stock.
Market Capitalisation and Sector Context
Affle 3i Ltd is classified as a small-cap company within the Computers - Software & Consulting sector. Small-cap stocks often carry higher volatility and risk compared to larger, more established companies. Investors should weigh these risks against the company’s growth potential and current valuation metrics. The sector itself is competitive and rapidly evolving, which can impact the company’s ability to sustain growth and profitability.
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What This Rating Means for Investors
The 'Sell' rating on Affle 3i Ltd advises investors to exercise caution. Given the stock’s very expensive valuation and bearish technical indicators, the risk of price declines appears elevated. While the company’s quality and financial trends remain positive, these factors are currently outweighed by valuation concerns and weakening price momentum.
Investors holding the stock may consider reviewing their positions in light of these factors, particularly if seeking to limit downside risk. Prospective buyers should be mindful that the stock’s premium valuation demands continued strong performance to justify current prices. The rating encourages a prudent approach, favouring capital preservation over aggressive accumulation at this stage.
Summary of Key Metrics as of 05 February 2026
- Return on Equity (ROE): 12.9%
- Price to Book Value (P/B): 7.1 (Very Expensive)
- Profit Growth (1 year): +19.7%
- PEG Ratio: 2.7
- Stock Returns: 1D: -1.9%, 1W: +5.67%, 1M: -10.93%, 3M: -11.55%, 6M: -17.21%, YTD: -9.84%, 1Y: -1.63%
These figures highlight the mixed signals from Affle 3i Ltd’s current profile, reinforcing the rationale behind the 'Sell' rating.
Looking Ahead
Investors should continue to monitor Affle 3i Ltd’s quarterly earnings releases, sector developments, and broader market trends. Any significant changes in valuation, financial performance, or technical momentum could prompt a reassessment of the rating. For now, the cautious stance reflects a balanced view of the company’s strengths and vulnerabilities in the current market context.
Conclusion
Affle 3i Ltd’s 'Sell' rating by MarketsMOJO, last updated on 08 December 2025, remains relevant today given the stock’s current fundamentals and market behaviour as of 05 February 2026. While the company demonstrates good quality and positive financial trends, its very expensive valuation and bearish technical outlook suggest limited upside and heightened risk. Investors should consider these factors carefully when making portfolio decisions.
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