Fractal Analytics IPO Opens Feb 9: Price, GMP, and Details

Introduction to Fractal Analytics IPO

Fractal Analytics, a global enterprise specializing in Artificial Intelligence (AI) and analytics, is launching its Initial Public Offering (IPO) on February 9, 2026. The company aims to raise ₹2,833.90 crores through this public issue, which includes a combination of a fresh issue of shares and an offer for sale (OFS) by existing shareholders. As one of India's prominent pure-play AI firms, this IPO is attracting significant attention from investors looking for exposure to the high-growth technology sector. The offering provides a unique opportunity to invest in a company that helps major global corporations make data-driven decisions.

IPO Structure and Key Dates

The public issue is a book-built offer with a total size of ₹2,833.90 crores. It comprises a fresh issue of 1.14 crore shares, aggregating to ₹1,023.50 crores, and an offer for sale of 2.01 crore shares, valued at ₹1,810.40 crores. The IPO subscription window will be open for three days, from Monday, February 9, 2026, to Wednesday, February 11, 2026. The allotment of shares is expected to be finalized on February 12, 2026, with the shares being credited to the demat accounts of successful applicants by February 13, 2026. The company's shares are slated to be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), with a tentative listing date of February 16, 2026.

Price Band and Lot Size

Fractal Analytics has set the price band for its IPO at ₹857 to ₹900 per equity share. The face value of each share is ₹1. Retail investors can apply for the IPO in lots, with one lot consisting of 16 shares. At the upper end of the price band, the minimum investment required for a single lot is ₹14,400. This structure makes the IPO accessible to a wide range of retail participants. The company's pre-issue market capitalization stands at ₹15,473.60 crores.

Company Financial Performance

Fractal Analytics has demonstrated strong financial growth and a significant turnaround in profitability. For the fiscal year ending March 31, 2025, the company reported a revenue of ₹2,816.20 crores, a 25.61% increase from the ₹2,241.90 crores recorded in the previous fiscal year. More notably, the Profit After Tax (PAT) saw a remarkable recovery, increasing by 503.29% to ₹220.60 crores in FY25 from a loss of ₹54.70 crores in FY24. This financial performance highlights the company's ability to scale its operations and improve profitability. Key performance indicators such as the EBITDA margin stood at 14.40% and the PAT margin was 8.00% for the period ending March 31, 2025.

Objectives of the Issue

The proceeds from the fresh issue component, amounting to ₹1,023.50 crores, will be utilized to fund the company's strategic growth initiatives. A significant portion, ₹355.10 crores, is allocated for investment in research and development and to bolster sales and marketing activities under its Fractal Alpha platform. Another ₹121.10 crores will be used for setting up new office premises in India. The remaining funds are earmarked for funding inorganic growth through potential acquisitions and other strategic initiatives, as well as for general corporate purposes. The funds from the Offer for Sale will go to the selling shareholders and not the company.

Valuation and Peer Comparison

Based on the upper price band of ₹900, the company's post-issue Price-to-Earnings (P/E) ratio is projected to be 109.12, a significant increase from the pre-issue P/E of 65.5. This valuation appears elevated, reflecting the high-growth nature of the AI and analytics industry. The post-issue Earnings Per Share (EPS) is expected to be ₹8.25. Investors should consider this premium valuation in the context of the company's strong growth trajectory and its unique position as a pure-play AI firm in the Indian market.

Grey Market Premium (GMP) Analysis

Ahead of its public offering, Fractal Analytics has generated positive sentiment in the grey market. The Grey Market Premium (GMP) has been fluctuating, with recent trends indicating a premium of around ₹85 to ₹99 per share. This suggests a potential listing gain of approximately 9% to 11% over the issue price. While GMP is an unofficial indicator and can change based on market sentiment, the current trend reflects moderate optimism among investors regarding the IPO's listing prospects.

Potential Risks for Investors

Despite the positive outlook, potential investors should be aware of certain risks. The company has a significant dependency on the US market, which exposes it to geographic concentration risk. Additionally, the nature of its business involves implementation and delivery challenges. There are also signals of pressure on profits and margins, which could impact future financial performance. The high attrition rate, which was 16.3% in FY25, is another factor to consider as the company operates in a competitive talent market.

How to Apply for the IPO

Investors can apply for the Fractal Analytics IPO through various platforms. Customers of brokerage firms like Zerodha can use the UPI payment gateway via their console. The application process involves logging into the demat account, navigating to the IPO section, selecting the Fractal Analytics IPO, and placing a bid for the desired number of lots. After submitting the application, investors will receive a UPI mandate request which must be approved to block the funds. The allotment status can be checked on the registrar's website, MUFG Intime India Pvt. Ltd., or on the BSE and NSE websites after the allotment is finalized.

Conclusion

The Fractal Analytics IPO presents an opportunity to invest in a leading enterprise AI and analytics company with a strong track record of revenue growth and a recent turnaround in profitability. The funds raised will support its expansion and innovation efforts. However, the high valuation, significant OFS component, and certain business risks warrant careful consideration. Investors should analyze their risk appetite and investment goals before subscribing to the issue.