BFSI to outpace other segments in growth, says Fractal Analytics Group CEO

Following its listing on the stock exchanges earlier in February this year, for Q1FY27, Mumbai-based Fractal Analytics posted revenue of ₹912.5 crore, up 9% year-on-year in constant currency terms. For a company that sells AI-driven services and products, the top 10 clients bring nearly 52% of its revenue, with consumer packaged goods and retail and healthcare and life sciences being its top two revenue segments, contributing 37.8% and 23.5% to its revenue, respectively. At a time when the banking and financial services industry has been seen adopting AI at a rapid pace, the BFSI segment for Fractal is still in the low teens in terms of industry revenue.

Speaking to Fortune India, the group chief executive and executive vice-chairman of Fractal Analytics, Srikanth Velamakanni, who co-founded the company in 2000, told the company’s agentic AI platform Cogentiq is now particularly seeing stronger traction even within the BFSI space.

“It's a small segment for us, which is kind of disproportionately small for Fractal relative to other industries. And I would blame that maybe in the past we didn't execute so well,” said Velamakanni, adding that the latest appointment of Leandro DalleMule as chief practice officer (CPO), financial services & insurance (FSI), is intended to fix this gap.

Referring to underwriting as an important use case there and a lot of interest in AI adoption, “In general, BFSI segment really wants to get this right, because this is the place where they feel there's a lot of process-intensive, risk-intensive work that are better done by machines, working alongside humans, than humans alone,” Velamakanni said, adding that with a new leader and the demand, “Our BFSI segment should be growing faster than, you know, the industry should be faster than the rest of Fractal for the foreseeable future.”

With a high revenue concentration around the top 10 clients, the group CEO said that while the company has historically had 80% of its growth coming from existing clients and 20% growth coming from new clients, it is currently acquiring clients at the rate of one every seven to 10 days, with Fractal being selective in terms of who it serves.

Along with new inbound leads and existing clients committing to incremental spends towards AI, Velamakanni explained that the bullishness for Fractal stems from both, with buyers having more AI spend availability and industry reference for its work.

With Fractal having partnerships with hyperscalers such as AWS, Google Cloud, Microsoft and C3.ai, Databricks, Anthropic and OpenAI, Velamakanni also sees the opportunity to become the implementation architects for enterprises with its data analytics and modelling strengths. “The next step is revenue acceleration. And today, single-digit percentage of Fractal's revenue comes from partnership-led revenue. But we're seeing that expand to a much, much higher number.”