Fractal Analytics Files DRHP for ₹4,900 cr IPO, to be First AI-Focused Firm to Tap Public Market

Fractal Analytics, an AI firm, has filed a Draft Red Herring Prospectus (DRHP) with SEBI for an Initial Public Offer (IPO) worth Rs 4,900 crore. The IPO comprises a fresh issue of equity shares aggregating up to ₹12,79.3 crore and an offer for sale of equity shares aggregating up to ₹3620.7 crore. The company may consider a pre-IPO placement aggregating up to ₹2,55.8 crore. Fractal proposes to utilize the net proceeds from the offer towards investment in one of its subsidiaries, pre-payment of borrowings, and other strategic initiatives.

Artificial Intelligence (AI) firm Fractal Analytics has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an Initial Public Offering (IPO) worth ₹4,900 crore. The IPO includes a fresh issue of equity shares aggregating up to ₹12,79.3 crore and an offer for sale of equity shares aggregating up to ₹3620.7 crore. Additionally, the company may consider a pre-IPO placement aggregating up to ₹2,55.8 crore [2].

Fractal Analytics aims to utilize the net proceeds from the offer towards investment in one of its subsidiaries, pre-payment of borrowings, and other strategic initiatives. The company, co-founded in 2000 by Srikanth Velamakanni and Pranay Agrawal, provides AI-driven analytics and decision-support solutions to major global enterprises. It has operations in the US and India, deriving over 66% of its revenues from the Americas, 17.7% from Europe, and the rest from the APAC region [2].

The IPO will be conducted through the book-building process, with 75% of the net offer allocated to qualified institutional buyers, 15% to non-institutional investors, and 10% to retail investors. Up to 5% of the post-offer equity will be reserved for eligible employees. The book-running lead managers for the offering include Kotak Mahindra Capital, Morgan Stanley India, Axis Capital, and Goldman Sachs (India) [1].

Fractal Analytics reported revenues of ₹2,765 crore and a profit of ₹22 crore for FY25, representing a 25.9% increase in revenue and a positive turnaround in profit after tax [2]. The company has demonstrated strong growth, growing at an 18% CAGR between 2023 and 2025 compared to third-party data, analytics, and AI services companies that grew at 11% during the same period [2].

References:
[1] https://stocktwits.com/news-articles/markets/equity/ai-firm-fractal-analytics-files-drhp-to-raise-49-billion/chrCTzARdBg
[2] https://www.business-standard.com/markets/ipo/ai-firm-fractal-analytics-files-drhp-eyeing-to-raise-4-900-cr-via-ipo-125081300508_1.html