HOLT Financials "3i Group - What is the market paying for Action?" Nimtz

Research evidence excerpt

HOLT Financials "3i Group - What is the market paying for Action?" Nimtz

Global Research

20 May 2026ab

HOLT Financials Equities

Global3i Group - What is the market paying for

Action? Financial

Julius Nimtz

HOLT Sector Specialist

julius.nimtz@ubs.com

3i Group's shares declined 17% over the past week after reporting full-year numbers, +44-20-7888 8653

with like-for-like sales growth at its key investment, Action, slowing to 2.4% YTD.

Hiten Patel, CFA, FCA

Action represents approximately 76% of 3i’s private equity portfolio, and over the past

HOLT Specialist

year, 3i has increased its ownership stake, which now exceeds 65%. The key investor hiten.j.patel@ubs.com

debate centres on the sustainability of growth and the appropriate valuation multiple for +44-20-7883 5132

Action. UBS analyst Haley Tam provides an updated overview here, which we leverage in

this UBS HOLT report.

Within the HOLT framework, 3i’s operating performance can be separated into recurring

income and portfolio revaluations. This distinction provides greater transparency on

underlying profitability versus valuation-driven gains. In this context, portfolio

revaluations, particularly those linked to Action, represent a critical driver of operational

performance and therefore valuation. We present a sensitivity analysis across different

EV/EBITDA multiples for Action and different overall portfolio revaluation rates from

2027-29e.

Short-term capital appreciation is highly sensitive to the valuation multiple applied to

Action. Applying a range of EV/EBITDA multiples from 10.5x to 18.5x results in a wide

dispersion of valuation outcomes.

At the last closing price of GBP 22.10, HOLT indicates the market is pricing in an EV/

EBITDA of 13.5x assuming ongoing portfolio revaluations at 14% p.a. (from 2027-29e),