Fractal Analytics IPO: India’s First AI Public Issue Likely To Hit Market At Over $2 Billion Valuation

Fractal, India’s first AI unicorn, is seeking to capitalise on investor demand for the emerging sector as well as the country’s adoption of consumer technologies.

AI-stocks have seen a tremendous run-up on the Wall Street, but many of them are in the chips and devices space. Indian IT companies have started investment in AI as part of their offering to the global customers. Newers clients are asking for services along with AI offerings that help would help in cost takeouts and reduce their SG&A expenses.

Co-founded in 2000 by five graduates of the Indian Institute of Management Ahmedabad, the startup’s valuation topped $1 billion in 2022. Since then it has doubled.

Three of the founders have since exited, leaving Group Chief Executive Officer Srikanth Velamakanni and Fractal CEO Pranay Agrawal at the helm. The key managerial personnels, who each own about 10% of the company pre-IPO, aren’t selling shares in the IPO.

Fractal, whose global customer base includes Citigroup Inc., Royal Philips NV and Nestle SA, offers AI products and services to help enterprises improve operational efficiency, design new products, and build sustainable supply chains. It has partnered with OpenAI, using its models to build generative AI solutions.

The company has submitted bids to develop an indigenous health-care large language model as well as a large reasoning model under the IndiaAI Mission, a government initiative to help develop homegrown AI technologies.

The AI company became EBITDA positive in FY24 and profitable in FY25. The topline for the company has grown at a compounded annual growth rate of 18% since FY23.

The company operates in consumer packaged goods and retail, technology, media and telecom, healthcare and life sciences, and banking, financial services and insurance which contributed 39.3%, 29.9%, 13.8%, and 11.0%, respectively in fiscal 2025 to its revenue from operations in the Fractal.ai segment.

It also derived 65.2% of its revenue from operations in the United States of America for FY25.

Kotak Mahindra Bank, Morgan Stanley, Axis Capital and Goldman Sachs Group Inc. are the arrangers for the IPO.