Fractal Analytics files for ₹4,900-Cr IPO; banks on AI-led innovation

Fractal Analytics, an artificial intelligence-driven analytics company, on Wednesday said it has filed preliminary papers with the markets regulator, Securities and Exchange Board of India (SEBI), seeking its approval to raise ₹4,900 crore through an initial public offering (IPO).

With a team of more than 5,000 professionals worldwide, out of which about 4,600 are based in India, the company is planning to expand its Artificial Intelligence (AI) offerings with a focus on agentic AI-led innovation.

The IPO comprises a fresh issue of equity shares aggregating up to ₹12,793 million and an offer for sale of equity shares aggregating up to ₹36,207 million. The company may consider a pre-IPO placement aggregating up to ₹2,558 million, subject to applicable laws and at its discretion, according to the draft red herring prospectus (DRHP) filed.

The company intends to use the IPO's net proceeds to invest in its subsidiary, Fractal USA, for debt repayment, purchase laptops, establish new offices in India, invest in R&D, fund sales and marketing under Fractal Alpha, pursue acquisitions, and for general corporate purposes.

Founded in 2000 by Srikanth Velamakanni and Pranay Agrawal, Fractal Analytics provides data-driven insights and AI solutions to global enterprises across industries like consumer packaged goods, retail, technology, media and telecom, healthcare and life sciences, and banking, financial services, and insurance.

Backed by investors including TPG, Apax, and Gaja, Fractal offers AI solutions under Fractal.ai, including the Cogentiq agentic AI platform and Fractal Alpha. The company boasts of prestigious clientele, such as Amica Insurance, C3 AI, Citibank, Costco, Franklin Templeton, Mars, Mondelez, Nestlé, and Philips.

Over 66% of Fractal's revenue comes from the Americas, 17.7% from Europe, and the remainder from the APAC region. Industry reports suggest Fractal is well-positioned with active investments in AI and Gen AI software and R&D. As of March 31, it serves major companies including Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla.

Fractal has developed Kalaido.ai (a text-to-image model) and Vaidya.ai (a medical multi-modal foundational ecosystem), and open-sourced Fathom-R1-14B, a large AI reasoning foundation model. In FY25, Fractal’s revenue from operations increased by 25.9% to ₹2765 crore from ₹2196 crore in FY24. Profit after tax improved to ₹220 crore in FY25 from a loss of ₹ 54.7 crore in FY24. PAT and EBIDTA margins also increased to 12.6% and 17.4% respectively. Between 2023 and 2025, Fractal has grown at an 18% CAGR compared to the 11% growth of third-party data, analytics, and AI services companies.

Srikanth Velamakanni, Co-Founder & CEO, views the IPO as a natural step toward the company's long-term vision, increasing accountability to shareholders and other stakeholders. Fractal invests heavily in R&D, allocating around 7-10% of its revenue to this area and hiring about 2,000 people annually for these efforts.

Recent product launches include Marshallgoldsmith.ai (an AI-powered coaching tool), Kalaido.ai, and Vaidya.ai. In July, Fractal launched Cogentiq, an agentic AI platform. The company is also developing Project Pioneer, a multi-agent AI system for real-world applications like software development.

Fractal’s IPO plans come at a time when AI is growing at an unprecedented rate. The global AI market is projected to reach $1.81 trillion by 2030, with a CAGR of 35.9% between 2025 and 2030, according to Grand View Research.

Kotak Mahindra Capital Company Limited, Morgan Stanley India Company Private Limited, Axis Capital Limited, and Goldman Sachs (India) Securities Private Limited are the Book Running Lead Managers to the IPO.