As Fractal prepares to file its DRHP, CEO converts partly paid shares and strengthens equity position amid public listing plans
Velamakanni Converts Partly Paid Shares Worth INR 48.7 Cr
Srikanth Velamakanni, cofounder and CEO of Fractal Analytics, has infused INR 48.7 Cr (~$5.6 Mn) into the company by converting his 6.6 lakh partly paid-up shares into fully paid-up equity shares at INR 733 per share.
- This move significantly boosts the founder’s stake ahead of the company’s much-anticipated $500 Mn IPO filing, expected in August 2025.
- The investment reflects strong founder confidence in the company’s value and public market readiness.
Employee Equity Allotments Under ESOP Scheme
Alongside the founder’s investment, Fractal also allotted 1.32 lakh equity shares to 81 employees in June under its employee stock ownership plan (ESOP).
- The move is part of Fractal’s ongoing efforts to align key talent with long-term value creation, especially in the lead-up to the IPO.
Fractal’s Public Listing Strategy
The IPO-bound SaaS unicorn has reportedly onboarded Morgan Stanley, Kotak Mahindra Capital, and Axis Capital as bankers for the public issue.
- This marks Fractal’s second attempt at an IPO, following its 2021 deferment due to unfavorable market conditions.
- The IPO may include an offer-for-sale (OFS) component by investors such as TPG, TA Associates, and Khazanah Nasional Berhad.
Financial Snapshot: Growth Amid Losses
Fractal slipped into the red in FY24, posting a net loss of INR 54.7 Cr, a stark contrast to the INR 194.4 Cr profit in FY23.
- However, revenues climbed 11% YoY, reaching INR 2,196.3 Cr.
- The losses are attributed in part to R&D expenses and new product development as the company doubles down on AI innovation.
Expanding AI Product Suite
Fractal, founded in 2000 by Velamakanni and Pranay Agrawal, offers AI and advanced analytics solutions globally, with major clients like Google and Wells Fargo.
- Its product portfolio includes:
- Cogentiq – enterprise agentic AI platform
- Iqigai – GenAI recruiting tool
- Kalaido.ai – text-to-image generator
- Marshallgoldsmith.ai – executive coaching AI
- Flyfish.ai, Vaidya.ai, Asper.ai, Qure.ai – vertical-specific AI tools
Big Bets on Deep Tech R&D
Fractal is actively investing in foundational AI research:
- It submitted a INR 150 Cr proposal to the IndiaAI Mission for building a multimodal medical foundational model.
- It also announced INR 118 Cr investment to develop India’s first large reasoning model (LRM).
These initiatives could not only drive future monetization, but also differentiate Fractal in the competitive AI landscape.
