Imagine stepping into India’s hottest AI IPO amid a global tech boom—yet watching subscription numbers barely flicker. That’s Fractal Analytics for you. As enterprises worldwide pour billions into AI, this Mumbai-based analytics powerhouse debuted on February 16, 2026, marking one of the year’s purest AI plays. But with shares trading below issue price and a sky-high valuation, is this a growth story worth betting on, or just another overpriced listing?
Investors buzzed about Fractal Analytics IPO review for good reason: it’s India’s first major pure-play AI firm going public, riding a $229 billion global market wave. Yet muted demand raises questions—can its turnaround sustain in a competitive arena? Let’s break it down step by step, so you can decide if it fits your portfolio.
Fractal Analytics: What Does It Really Do?
Picture a company that’s been quietly powering decisions for Fortune 500 giants like Citi and Nestle since 2000. Fractal Analytics delivers AI-driven analytics, decision sciences, and engineering solutions—think platforms spotting healthcare anomalies or optimizing retail supply chains.
Their business boils down to three revenue streams:
Core analytics services (96% of FY25 revenue at ₹2,701 Cr): Custom AI consulting for finance, healthcare, and telecom.
Platform subscriptions (2%, growing 167% YoY): SaaS-like tools like Qure.ai for medical imaging and Eugenie.ai for fraud detection.
Other income (₹51 Cr): Subsidiary gains and investments.
What sets them apart? Heavy R&D spend (6% of revenue, ₹144 Cr in FY25), over 100 patents, and a global delivery model from India—keeping costs low while serving 100+ enterprise clients. Founders Srikanth Velamakanni (CEO) and Pranay Agrawal bring two decades of scaling tech services. Growth hinges on shifting from consulting to sticky platforms, plus M&A and new markets.
In a nutshell, Fractal isn’t your typical IT outsourcer; it’s betting big on enterprise AI scalability.
IPO Basics: The Numbers Investors Need to Know
Fractal’s mainboard IPO hit BSE/NSE (symbol: FRACTAL) with a ₹2,834 Cr issue—split as ₹1,026 Cr fresh capital and ₹1,808 Cr offer-for-sale (OFS). Price band: ₹857-₹900/share; lot size 16 shares (minimum ₹14,400 investment).
Key dates:
Opened: Feb 9, 2026
Closed: Feb 11, 2026
Allotment: Feb 12
Listed: Feb 16 (opened flat, closed ~₹847, down 6%).
Why does the split matter? Fresh issue funds growth (debt repayment ₹265 Cr, R&D ₹355 Cr, acquisitions ₹161 Cr), but heavy OFS (64%) means existing shareholders cashing out—often a red flag for short-term pops.
Allocation favored QIBs (73%, including 44% anchors like mutual funds raising ₹1,248 Cr), with retail at 10%. Lead managers: Kotak; registrar: MUFG Intime.
AI Analytics Boom: Where Fractal Stands
India’s AI analytics sector is exploding at 25-30% CAGR, fueled by digital transformation and data localization mandates. Global trends? Enterprises adopting GenAI, with AI budgets surging amid offshoring from the US.
Competitors like Mu Sigma, LatentView, ZS Associates, and Axtria dominate, but most are unlisted. Fractal positions as a vertical specialist—strong in platforms vs. broad IT players like Accenture or Palantir wannabes. Regulations help: SEBI’s supportive, though global data privacy adds hurdles.
Bottom line: Fractal’s in the sweet spot, but execution against automation threats will define it.
Financials Unpacked: Turnaround or Temporary Blip?
Dig into the numbers, and FY25 shines: Revenue jumped 25.9% to ₹2,765 Cr; EBITDA rebounded to ₹398 Cr (14.4% margin); PAT flipped to ₹221 Cr from FY24’s ₹55 Cr loss.
Here’s the trend at a glance:
| Metric (₹ Cr) | FY23 | FY24 | FY25 | H1FY26 |
|---|---|---|---|---|
| Revenue | 1,985-2,044 | 2,196-2,242 | 2,765-2,816 | 1,559-1,594 mstock+1 |
| EBITDA | 437 | 159-97 | 398 | 186 |
| PAT | 194 | -55 | 221 | 71 |
| Debt | Low at ₹266 Cr |
RoNW hit 12.6%, cash flow turned positive at ₹397 Cr (FY25). Strengths? 39% two-year revenue CAGR, conservative debt. Weak spots: Top 10 clients = 54% revenue; FY24 one-offs masked issues; H1FY26 cash dip.
For investors, this signals profitability revival—but client dependency could jolt if a big name walks.
Is the Price Tag Fair? Valuation Breakdown
At ₹900 upper band, market cap clocks ₹15,474 Cr. Multiples scream premium: P/E 65.5x pre-IPO (109x post), EV/EBITDA ~39x, P/B 8.65x.
Peers like LatentView trade ~40x P/E, but Fractal demands more for its AI purity—26% below last private round (₹21,000 Cr val). Justified? Only if 30%+ CAGR holds and margins hit 20%.
Think of it like recent tech IPOs: High flyers like Zomato took years to justify premiums. Here, stretched valuations suit patient capital, not quick flips.
GMP and Subscription: What the Market Said
Grey Market Premium (GMP) told the story—peaked early at ₹170, crashed to ₹7-8 (0.8-1%) by Day 3, signaling flat listing. Final subscription: 1.24x overall (Retail 0.75x led; QIB a dismal 0.08x).
Strong anchors showed institutional faith, but public yawned—classic high-OFS fatigue. Post-listing at ₹847 reflects caution amid pricey multiples.
Sentiment? Cautious optimism for AI long-game, skepticism short-term.
Risks No Investor Can Ignore
Every opportunity has traps. Fractal’s include:
Client crunch: 54% from top 10; lose one, revenue tanks.
- GenAI disruption: Automation could eat consulting margins.
- OFS exit vibes: Promoters dipping to 16.98% post-IPO.
Execution: Unaudited foreign ops, talent wars, cyclical tech spends.
Market timing: Listed in volatile Feb 2026 markets.
High OFS plus weak QIBs amplify listing risks—behavioral finance 101: FOMO fades fast.
My Take as Your Market Advisor
Short-term? Expect sideways grind; GMP nailed the muted debut. Long-term (3-5 years)? If platforms scale and AI tailwinds deliver, wealth creation beckons for high-conviction holders.
Suits aggressive HNIs/institutions with 30%+ growth bets. Risk-averse retail
? Sit out. Compare to LatentView’s steady climb—patience pays, but not without volatility.
Final Verdict: Fractal Analytics IPO Review
Neutral – Long-term only. Subscribe if you’re an AI believer eyeing 20%+ margins; avoid for listing gains or low-risk plays. Weak subscription and 70x P/E scream caution, but fundamentals hint at potential. Watch Q4FY26 for platform traction. Always align with your risk appetite—no IPO‘s a sure bet.
