Fractal Analytics IPO is creating strong buzz among IPO investors and technology sector followers, especially those tracking the fast-growing artificial intelligence (AI) and analytics space. The company positions itself as a global enterprise AI and analytics partner to some of the world’s largest brands, offering end-to-end solutions across industries. In this detailed Fractal Analytics IPO review, I will cover issue details, financial performance, valuation analysis, competitive strengths, GMP trends, positive and negative factors, and finally answer the big question – Should you subscribe to this IPO or avoid it?
About Fractal Analytics Ltd
Fractal Analytics Ltd. was incorporated in March 2000 and has grown into a global enterprise AI and advanced analytics company. It works with large multinational corporations to help them make smarter, data-driven decisions using artificial intelligence, machine learning, and analytics platforms.
As of September 30, 2025, the company’s business is structured into two key operating segments:
Fractal.ai
This is the core AI services and products segment. It operates through its agentic AI platform, Cogentiq, which offers low-code tools, governance, built-in security, and product development frameworks. This platform is designed to help enterprises rapidly deploy AI solutions across business functions such as marketing, supply chain, risk, and customer experience.
Fractal Alpha
This segment houses independent AI-driven businesses targeted at high-growth markets. These businesses are managed separately to encourage innovation, geographic expansion, and vertical-specific AI solutions.
Fractal serves a strong global client base that includes well-known names like Citi, Costco, Franklin Templeton, Mars, Mondelez, Nationwide, Nestle, and Philips. Its long-standing relationships with large enterprises provide stability and recurring revenue visibility.
Competitive Strengths of Fractal Analytics
1. Leadership in a Fast-Growing AI Market
AI and data analytics adoption is accelerating globally across BFSI, FMCG, retail, healthcare, and manufacturing. Fractal operates in a large and expanding market where enterprises are increasingly outsourcing AI implementation and data intelligence functions.
2. Strong Client Relationships with Global Brands
The company has multi-year engagements with marquee global clients. These long-term contracts reduce revenue volatility and enhance customer stickiness.
3. Deep Domain and Technical Expertise
Fractal combines AI engineering with industry-specific domain knowledge, enabling it to deliver customized enterprise-grade solutions rather than generic software products.
4. Proven Innovation Track Record
Continuous investments in platforms like Cogentiq and Fractal Alpha demonstrate a focus on long-term technology leadership.
5. Founder-Led Management Team
The company is led by experienced founders with a long-term vision, which is often seen as a positive sign for strategic consistency and culture.
Fractal Analytics IPO Issue Details
Fractal Analytics IPO is a book-building issue of ₹2,833.90 crore, consisting of both a fresh issue and an offer for sale (OFS).
IPO Dates
- IPO Open Date: Monday, Feb 9, 2026
- IPO Close Date: Wednesday, Feb 11, 2026
- Allotment Date: Thursday, Feb 12, 2026
- Refunds & Credit of Shares: Friday, Feb 13, 2026
- Listing Date: Monday, Feb 16, 2026
Price Band and Lot Size
- Price Band: ₹857 to ₹900 per share
- Face Value: ₹1 per share
- Lot Size: 16 shares
- Minimum Investment (Retail): ₹14,400 (at upper band)
Issue Size Breakdown
- Total Issue Size: ₹2,834 crore
- Fresh Issue: ₹1,023 crore (1.14 crore shares)
- Offer for Sale: ₹1,810 crore (2.01 crore shares)
Market Capitalization
- Pre-IPO Market Cap: ₹15,473.60 crore
Reservation
- QIB: Not less than 75% of net offer
- NII: Not more than 15%
- Retail: Not more than 10%
Lead Managers and Registrar
- Book Running Lead Manager: Kotak Mahindra Capital Co. Ltd.
- Registrar: MUFG Intime India Pvt. Ltd.
Company Financials (₹ in Crores)
| Period Ended | Total Income | PAT | EBITDA | Net Worth | Total Borrowing |
|---|---|---|---|---|---|
| Sep 30, 2025 | 1,594.30 | 70.90 | 185.60 | 1,957.50 | 274.60 |
| Mar 31, 2025 | 2,816.20 | 220.60 | 398.00 | 1,748.30 | 266.20 |
| Mar 31, 2024 | 2,241.90 | -54.70 | 97.20 | 1,397.00 | 250.10 |
| Mar 31, 2023 | 2,043.70 | 194.40 | 436.80 | 1,339.20 | 325.60 |
Key Observations
- Revenue growth has been healthy, but profitability is volatile, including a loss in FY24.
- PAT margins and EBITDA margins have declined in the latest period.
- Borrowings are moderate, but returns on net worth remain low compared to premium valuations.
Objects of the IPO
The company plans to use the IPO proceeds for the following:
- Debt Repayment in Fractal USA Subsidiary – ₹264.90 crore
- Purchase of Laptops and IT Infrastructure – ₹57.10 crore
- Setting Up New Office Premises in India – ₹121.10 crore
- R&D and Sales & Marketing under Fractal Alpha – ₹355.10 crore
- Inorganic Growth, Acquisitions, and General Corporate Purposes
Interpretation
While part of the funds will be used for growth and innovation, a significant portion is allocated to debt repayment and infrastructure, which may not directly translate into immediate revenue acceleration.
Valuation and P/E Ratio Comparison
At the upper price band of ₹900:
- Pre-IPO EPS: ₹13.74
- Post-IPO EPS: ₹8.25
- Post-IPO P/E: ~109x
Comparison of IPO Price with Peer Comparison
There are no listed peers to compare as per RHP. However in general, Post IPO P/E of 109x looks to be over-priced
Reasons to Invest in Fractal Analytics IPO
1. Strong Position in a High-Growth AI Market
AI adoption is still in early to mid-stages globally. Enterprises are increasingly spending on analytics, automation, and decision intelligence, which creates a long runway for companies like Fractal.
2. High-Quality Client Base
Serving global giants like Citi, Nestle, and Mondelez adds credibility, revenue stability, and strong references for future client acquisition.
3. Scalable Platform-Based Model
With platforms like Cogentiq, Fractal is moving beyond pure services into AI products, which can improve operating leverage and long-term margins if adoption scales.
4. Focus on Innovation and R&D
Significant IPO proceeds are earmarked for R&D and Fractal Alpha, indicating a commitment to future-ready AI solutions and new business models.
5. Long-Term Sector Tailwinds
Digital transformation, cloud adoption, and AI-driven automation are secular trends that can benefit Fractal over the next decade.
Risk Factors and Negative Points
1. Very High Valuation Risk
At over 100x post-IPO earnings, the stock leaves little margin for error. Even minor earnings disappointments can lead to sharp corrections.
2. Inconsistent Profitability
The company reported losses in FY24 and fluctuating margins. This raises concerns about cost control and scalability.
3. High Dependence on Large Clients
A significant portion of revenue comes from a limited number of large global clients. Any contract loss or pricing pressure could materially impact financials.
4. Competitive AI Services Market
The AI and analytics space is highly competitive, with global IT giants, consulting firms, and specialized startups offering similar services.
5. Execution Risk in Fractal Alpha Segment
The success of new AI ventures under Fractal Alpha is uncertain and may take time to become profitable.
Grey Market Premium (GMP) of Fractal Analytics IPO
As of now, Fractal Analytics IPO GMP is trending around RS 160.
Note: GMP is an unofficial indicator and should not be the sole basis for investment decisions.
How to Buy / Apply for Fractal Analytics IPO
You can apply for this IPO through:
- Your Bank’s ASBA Facility (Net Banking)
- Stockbroker Platforms (Zerodha, Groww, Upstox, Angel One, etc.)
Steps
- Login to your broker or bank account
- Select Fractal Analytics IPO
- Enter number of lots and bid price (or cut-off)
- Submit and approve the UPI mandate
FAQs on Fractal Analytics IPO
1. What is the minimum investment for Fractal Analytics IPO?
₹14,400 for one lot (16 shares) at the upper price band.
2. What is the IPO opening and closing date?
The IPO opens on Feb 9, 2026 and closes on Feb 11, 2026.
3. What is the price band of Fractal Analytics IPO?
₹857 to ₹900 per share.
4. Is this IPO suitable for short-term listing gains?
This depends on GMP trends and market sentiment. Valuation is high, so listing gains are not guaranteed.
5. What is the main risk in this IPO?
High valuation and inconsistent profitability.
6. Who are the lead managers and registrar?
Kotak Mahindra Capital is the lead manager and MUFG Intime India is the registrar.
Fractal Analytics IPO Review – Should You Invest or Avoid?
Fractal Analytics operates in a future-ready AI and analytics sector with strong global clients and a clear innovation-driven strategy. However, the IPO is priced at a very aggressive valuation, with over 100x post-issue earnings and inconsistent profit performance.
- For Long-Term, High-Risk Investors: You may consider this IPO if you strongly believe in AI sector growth and Fractal’s ability to scale its platform business.
- For Conservative or Valuation-Sensitive Investors: It may be better to avoid or wait for post-listing price stability.
In summary, this is a high-quality business but at a high price, making risk-reward less attractive at current IPO levels.
Disclaimer
This IPO review is for educational and informational purposes only and should not be considered as financial or investment advice. Investors are advised to read the Red Herring Prospectus (RHP), consult their financial advisor, and consider their risk profile before investing in any IPO. The stock market is subject to risks, and past performance does not guarantee future returns.
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