Fractal Analytics, an enterprise artificial intelligence (AI) company, has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) to raise up to ₹4,900 crore via the initial public offering (IPO) route.

The IPO comprises a fresh issue of equity shares worth up to ₹1,279.30 crore and an offer for sale (OFS) of shares aggregating up to ₹3,620.70 crore by existing shareholders.

Under the OFS, Quinag Bidco, TPG Fett Holdings Pte. Ltd, GLM Family Trust, Satya Kumari Remala and Rao Venkateswara Remala will be offloading shares.

According to the DRHP, up to 75% of the net offer is reserved for qualified institutional buyers (QIB), 15% for non-institutional investors (NII), and the remaining 10% for retail individual investors. It also includes a reservation for eligible employees, not exceeding 5% of the company’s post-offer paid-up equity share capital.

The company may also consider a pre-IPO placement aggregating up to ₹255.80 crore, prior to filing the red herring prospectus. If undertaken, the company may reduce the size of the IPO issue.

Fractal Analytics proposes to utilise the net proceeds from the fresh equity issuance towards investment in one of its subsidiaries, Fractal USA; repayment of loans; purchase of laptops; setting up new office premises in India; investment in research and development; and sales and marketing under Fractal Alpha; as well as funding inorganic growth through unidentified acquisitions, other strategic initiatives, and general corporate purposes.

Co-founded by Srikanth Velamakanni and Pranay Agrawal in 2000, Fractal supports large global enterprises across multiple industry verticals and business functions with data-driven insights, assisting in decision-making through end-to-end AI solutions.

Backed by marquee investors such as TPG, Apax, and Gaja, the country’s leading pure-play data and artificial intelligence company has domain expertise spanning consumer packaged goods & retail; technology, media, and telecom; healthcare and life sciences; and banking, financial services, and insurance.

Founded in 2000, Fractal focuses on AI and advanced analytics, providing DAAI consulting and technology services, software solutions, and AI products, with advanced capabilities in computer vision (CV), natural language processing (NLP), and Generative AI (Gen AI) for enterprises. As of March 31, 2025, the company’s full suite of AI solutions is organsed under two segments: Fractal.ai (comprising AI services and AI products primarily hosted on Cogentiq) and Fractal Alpha (comprising AI businesses).

According to an industry report mentioned in the DRHP, the company is uniquely positioned among peers, with active investments in expanding its AI and Gen AI software portfolio and R&D activities. It has served a majority of the world’s leading companies, including Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla.

“We intend to also continue to invest in our dedicated sales, account management and partnerships and alliances teams across our target geographies - US, UK, Europe, Australia and the Middle East, to win new managed workload contracts (MWCs), the company said in the DRHP. 

While the company is incorporated in India, it caters to a global clientele, with 91.6% of its fiscal 2025 revenue coming from clients located outside of India. Its revenue from operations increased by 25.9% to ₹2,765 crore in FY25, compared with ₹2,196 crore in FY24. Profit after tax turned positive at ₹220 crore in FY25 from a loss of ₹5.47 crore in FY24. PAT and EBITDA margins improved to 12.6% from (0.2%) and 17.4% from 10.6%, respectively.

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.

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