Britain's largest listed private equity firm shed 4.5% of its value today despite reporting healthy growth as it benefited from the success of Dutch discount retailer Action.
3i Group PLC (LSE:III) said net asset value rose from £17.45 per share to £20.85 in the year to March.
Action was the firm's "major driver" throughout the year after the retailer's sales soared by 28% to £9.72 billion while underlying earnings rose 34% to £1.38 billion.
Liberum analyst Joachim Klement believes the stock may see some profit-taking soon, which might be why the shares slid today.
Klement said: "We keep warning about the large concentration risk in the portfolio, the high valuation of the shares, and the difficult market environment for consumer companies like Action.
"But Action remains remarkably resilient... margin expansion has helped limit the drop in EBITDA growth which is a highly respectable result given the difficult market environment.
"Having said that, the results generally miss by some margin and came in barely above the lowest forecast of analysts covering the company."
"Overall, this is a mixed set of results, in our view, with Action’s performance holding up very well given the circumstances, but the company generally experiencing a sharper slowdown in growth and profits than expected."