3i Group (LON: III) Share Price Near 52‑Week Low as Action Slows – Is the Private Equity Giant a Buy in December 2025?

3i Group plc, the FTSE 100 private equity and infrastructure investor best known as the owner of European discounter Action, is suddenly on sale.

As of the close on 2 December 2025, 3i’s share price stood at 3,031p, only a fraction above its 52‑week low of 3,026p and well below the 4,496p high it hit earlier this year. The trust still trades at a premium of around 11% to its net asset value (NAV), but that premium has collapsed from a 12‑month average of roughly 54%. ^[1]

The sell‑off has been driven by a sharp market reaction to a slight slowdown in Action’s like‑for‑like sales growth, a more cautious tone from management on new deals, and renewed attention on a prominent short‑seller’s thesis. Yet the underlying numbers from 3i’s latest half‑year remain strong, and both insiders and most analysts appear to see the pull‑back as an opportunity rather than an existential warning.

Here’s what investors need to know as of 2 December 2025.

Where the 3i Group share price stands now

Hargreaves Lansdown data show that at the close on 2 December 2025, 3i Group traded at: ^[2]

Sell / buy: 3,031p / 3,034p
Day range: 3,026p–3,057p
52‑week range: 3,026p–4,496p
Dividend yield: about 2.4%, based on recent dividends
Latest actual NAV per share:2,857p as at 30 September 2025
Estimated current NAV: 2,833p
Premium to NAV: roughly 11.5%, versus a 12‑month average premium of ~53.7%

From the October high of 4,496p to around 3,031p today, the stock has dropped roughly a third in a matter of weeks. That re‑rating has taken 3i from a historically rich valuation to something closer to “expensive but arguable”, at least on traditional NAV metrics.

What triggered the November crash?

The turning point was 13 November 2025, when 3i reported results for the six months to 30 September 2025 (its FY2026 first half).

On the surface, the numbers were excellent:

Pre‑tax profit: around £3.3bn, up about 60% year on year
Total return on opening shareholders’ funds:13% for the half
NAV per share: up 12%, from 2,542p in March to 2,857p in September
Private Equity gross investment return: about £3.2bn (14%), driven largely by Action
Infrastructure gross investment return: about £139m, up significantly on the prior year
Interim dividend: lifted 20% to 36.5p, payable on 9 January 2026 ^[3]

Yet the share price reaction was brutal. Reuters reports that 3i slumped about 17% on the day, its worst daily fall on record, as investors focused not on the headline profits but on management’s more cautious commentary on the deal environment and on signs of softer trading at Action. ^[4]

Chief executive Simon Borrows stressed that the private equity portfolio was still showing “good momentum”, but warned that both the transaction market and the wider environment were likely to remain challenging into the second half. ^[5]

That was enough to pop a very stretched valuation. But what really unnerved the market was the detail on Action.

Action: the crown jewel, and the main source of fear

3i has spent a decade turning Action into one of Europe’s most successful discount retailers, with nearly 3,000 stores across 12 countries. Over time, Action has come to dominate 3i’s value:

MarketScreener notes that Action and fellow Dutch holding Royal Sanders account for the majority of the portfolio’s value, with Action alone representing around three‑quarters of the group’s worth by some estimates. ^[6]
The Financial Times recently described Action as making up nearly 80% of the value of 3i’s private‑equity portfolio, effectively turning the shares into a proxy for the chain’s performance. ^[7]

So when Action’s growth even flinches, 3i’s share price shudders.

Growth still strong, but slowing at the edges

The latest updates paint a picture of continuing high growth, with a clear but not catastrophic slowdown at the margin:

For the year to the end of the ninth trading “period” (P9), Action delivered around €11.23bn of net sales, 6.3% like‑for‑like (LFL) growth, and about €1.56bn of operating EBITDA. ^[8]
By the end of P10, net sales had risen to roughly €12.5bn, with EBITDA around €1.76bn, but LFL growth dipped to about 5.7%. The slowdown was linked to tougher comparatives, weaker seasonal categories, and especially softer trading in France. ^[9]
A September portfolio update from 3i highlighted that year‑to‑date sales at 21 September were 18% ahead of the prior year, with LFL at 6.5%, but flagged weaker consumer spending in France and Germany, along with strikes and unrest in France, as headwinds. ^[10]

France is crucial here. It accounts for roughly one‑third of Action’s sales, and in the most recent period its like‑for‑like growth lagged badly behind the rest of the network. ^[11]

3i warned that, if these trends persist, full‑year LFL growth at Action may fall short of the 6.1% guidance given in March. For a growth machine that investors had mentally priced as almost unstoppable, that modest downgrade was enough to crack confidence. ^[12]

ShadowFall and the “too much Action” thesis

None of this happened in a vacuum. Since late 2024, short‑seller ShadowFall Capital has been publicly betting against 3i, arguing that: ^[13]

3i’s stake in Action is significantly overvalued,
Action’s margins have been flattered by inflation, which is now easing, and
3i has become too concentrated in a single asset.

When Action’s growth cooled slightly and management turned more cautious on deals, the ShadowFall narrative suddenly looked less theoretical. The FT and other outlets explicitly linked the mid‑November slump to a combination of Action’s slowdown and those earlier short‑seller concerns. ^[14]

Beyond Action: what else is in 3i’s engine room?

It’s easy to forget that 3i is not just Action, even if the market often trades it that way.

Private equity portfolio

MarketScreener’s analysis notes that around 92% of 3i’s portfolio value is in private equity investments, mostly in medium‑sized businesses across business and technology services, industrial, healthcare and consumer sectors in Europe and North America. ^[15]

Recent moves include:

The sale of pet‑food group MPM to Partners Group, generating proceeds of around £400m at a money‑multiple of roughly 3.2x. ^[16]
The signed sale of IT services provider MAIT to Deutsche Beteiligungs AG (DBAG), expected to generate about £143m and a money‑multiple of 2.7x. ^[17]
New investments such as WaterWipes (a leading wet-wipe brand) and OMS Prüfservice, a German provider of electrical testing services – both geared towards recurring, defensible cash flows. ^[18]

MarketScreener points out that these deals show 3i can still create value outside Action, even if that value is overshadowed by the Dutch giant in today’s numbers. ^[19]

Infrastructure and the US “land of opportunity”

Infrastructure is a smaller but increasingly important part of the story. 3i manages 3i Infrastructure plc and a growing direct portfolio of infrastructure assets, particularly in North America.

In a 1 December article titled “Still the land of opportunity?”, 3i’s Rob Collins, managing partner for North American Infrastructure, describes: ^[20]

A focus on mid‑market US infrastructure rather than mega‑deals,
Emphasis on digital infrastructure, transportation, environmental services and social infrastructure, and
Examples such as Regional Rail, EC Waste in Puerto Rico and Smarte Carte (airport luggage and storage services), all of which provide essential services with resilient cash flows.

The half‑year results showed the infrastructure business delivering £139m of gross investment return, helped by a strong contribution from 3i Infrastructure plc and positive revaluations elsewhere. ^[21]

In short, 3i is actively diversifying away from being a pure Action story, even if the numbers are not yet balanced.

Balance sheet strength and dividend outlook

One reason many investors have been comfortable paying a large premium for 3i is the strength of its balance sheet and its self‑funding model:

At 30 September 2025, 3i reported liquidity of around £1.64bn, net debt of roughly £772m and gearing of just 3%. ^[22]
The group invests largely its own balance‑sheet capital rather than time‑limited funds, giving it flexibility to hold winning assets for decades and to reinvest capital from portfolio cash flows. TS2 Tech+1

On the income side:

The interim dividend has been raised to 36.5p per share, ex‑dividend on 27 November 2025 and payable 9 January 2026. ^[23]
Combined with the 42.5p final dividend paid in July, the FY2025 total dividend was 73p per share, continuing a multi‑year trend of rising payouts. ^[24]
Over the past five financial years, the annual dividend has climbed from 38.5p (FY2021) to 73p (FY2025), while coverage has remained high. ^[25]

At today’s share price, that puts the trailing yield at roughly 2–2.5% – modest, but backed by substantial underlying cash generation and the possibility of further growth if Action continues to expand.

Insider buying: management votes with its own money

One of the most striking developments since the sell‑off has been a surge in insider buying:

On 17 November, Alliance News reported that 3i’s senior team, including Chief Operating Officer Jasi Halai, Private Equity senior partner Peter Wirtz, CEO Simon Borrows and associate Karen McKellar, bought shares worth about £2.3m in aggregate, at prices around 3,292–3,416p. ^[26]
On 18 November, further disclosures showed non‑executive director Peter McKellar and finance director James Hatchley among insiders who had bought stock, bringing the total insider buying since the crash to roughly £3.7m. ^[27]
On 1 December, a regulatory news statement confirmed additional small purchases by several PDMRs (persons discharging managerial responsibilities) under the 3i Share Incentive Plan, at a subscription price of about 3,228.7p per share, with matching shares awarded for free. ^[28]

Insider buying doesn’t guarantee a bottom, but a wave of multi‑million‑pound purchases after a sell‑off is generally interpreted as a strong signal that management views the drop as excessive rather than as the start of a structural decline.

Analyst forecasts: targets still point well above today’s price

Despite the drama, the sell‑side consensus remains broadly positive.

MarketScreener’s latest summary of analyst views on 3i Group shows: ^[29]

Mean consensus rating:“Buy”
Number of analysts:10
Average 12‑month target price: about £45.16 per share
Last close used in that calculation: around £30.44, implying c. 48% upside to the average target

Third‑party aggregators referenced in the TS2 analysis similarly suggest: TS2 Tech+1

Average target prices in the mid‑£40s,
High‑end targets up to about 5,200p, and
A cluster of forecasts indicating roughly 40–50% upside from late‑November prices.

That said, the picture is not uniformly bullish. At least one broker, Kepler Cheuvreux, has downgraded the stock to “Reduce” and cut its price target since the November results, reflecting worries about valuation, concentration and the tough deal environment. ^[30]

So the consensus today looks something like:

Base case (majority): Action’s growth slowdown is manageable, the franchise remains exceptional, and the recent sell‑off has reset expectations to attractive levels.
Bear case (minority, but vocal): Action is over‑earning after a long period of inflation‑boosted margins, the valuation remains too rich, and the concentration risk is under‑appreciated.

Valuation: premium to NAV is smaller, but not gone

For years, 3i has traded at a lofty premium to NAV, reflecting:

Its exceptional track record of compounding NAV and total return, and
The fact that Action is valued on a private‑equity style multiple rather than on public‑market discount‑retail comparables.

According to Hargreaves Lansdown, as of 2 December 2025: ^[31]

Latest actual NAV (30 September): 2,857p per share
Current share price: 3,031p
Implied premium versus reported NAV: single‑digit to low‑teens percent, depending on whether you use the latest actual or estimated NAV figures
12‑month average premium: about 54%

TS2’s synthesis of various data points suggests that, prior to the crash, 3i occasionally traded at around 1.5x NAV, and that after the sell‑off the premium has compressed to roughly 10–13% above reported NAV, a huge change in sentiment but still a premium rather than a discount. TS2 Tech+2TS2 Tech+2

In other words: the market is now paying much less extra for the 3i “story”, but it still isn’t willing to treat 3i as a plain vanilla investment trust trading at or below its underlying asset value.

Key risks for 2026

Looking ahead, several risks stand out:

Further slowdown at Action
- If like‑for‑like sales growth at Action drifts materially below the mid‑single‑digit level or margins compress faster than expected, both 3i’s NAV and its premium to NAV could fall further. ^[32]
Consumer and regulatory pressure in core markets
- France, Action’s largest market, is already showing weaker growth amid higher taxes and economic uncertainty, according to recent coverage. ^[33]
- Any new regulation on pricing, labour or store expansion in European markets could slow its rollout.
Private‑assets valuation risk
- As MarketWatch noted earlier in the year, 3i and its peers operate in a world where private‑asset valuations and deal volumes are under pressure from higher rates and macro uncertainty. ^[34]
- If public markets re‑rate listed peers downward, it could force a rethink of the multiples applied to Action and other unlisted holdings.
Concentration risk
- Even after diversification efforts, Action still represents the majority of 3i’s value, so a serious mis‑step at the retailer would have outsized consequences for shareholders. ^[35]
Short‑seller overhang
- ShadowFall’s short thesis provides a ready‑made bearish narrative that can be dusted off whenever Action stumbles, potentially amplifying volatility. ^[36]

Reasons the long‑term bull case isn’t dead

Balanced against those risks are some powerful long‑term positives:

A decade‑plus of compounding – 3i’s recent annual report highlights a 25% total return for FY2025, with more than 20% total return in each of the last five years, implying an average annual total return around 30% over that stretch. TS2 Tech+1
Self‑funding structure and low leverage – 3i invests primarily its own permanent capital, with modest gearing and substantial liquidity, giving it flexibility that traditional closed‑end funds and private‑equity partnerships often lack. ^[37]
Growing infrastructure franchise – the push into mid‑market US infrastructure, including assets that benefit from AI‑driven demand for digital infrastructure, broadens 3i’s growth engines beyond European retail. ^[38]
Heavy insider buying – multi‑million‑pound director purchases after the crash are hard to reconcile with a management team that secretly shares the most pessimistic views. ^[39]

For long‑term investors who accept the “3i = leveraged bet on Action + infrastructure growth” framing, periods when the premium compresses and nervousness spikes are exactly when the stock tends to look most interesting.

So is 3i Group plc stock a buy after the crash?

From the public information available as of 2 December 2025, the picture looks something like this:

Business performance: still strong, with double‑digit total returns, rising NAV, and Action continuing to grow sales and EBITDA from a very high base. ^[40]
Valuation: no longer euphoric, but still not cheap – the shares trade at a modest premium to NAV instead of the hefty premium seen earlier in 2025. ^[41]
Sentiment: battered in the short term, yet insiders are buying, and the analyst consensus remains “Buy” with targets well above today’s price. ^[42]
Risk concentration: higher than in a typical investment trust; 3i is not a diversified basket so much as a high‑conviction compounder with a very large single asset.

Whether that mix justifies owning the stock now depends entirely on an investor’s risk tolerance, time horizon and view on Action and private‑asset valuations.

For those comfortable with volatility and with the idea that great long‑term stories often come with nasty drawdowns, 3i at a much smaller premium could be seen as an appealing entry point.

For more cautious investors – especially anyone uneasy about concentration risk or the opacity of private‑asset valuations – the market’s sudden shift in mood is a timely reminder that even a historically outstanding compounder can have a very bumpy ride.

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