Fractal Analytics raises $172 million in secondary as IPO plan gains momentum

Srikanth Velamakanni , Co-Founder, Group Chief Executive & Vice-Chariman_ Fractal

Artificial intelligence firm Fractal Analytics has secured $172 million through a secondary share sale, as the company gears up for a public listing, sources told Moneycontrol. The deal values the AI analytics firm at $2.44 billion.

The transaction involved the sale of a 6 percent stake held by long-time backer Apax Partners to a consortium of 22 institutional investors. The buyers include funds advised by Trust Investment Advisors, as White Oak Capital Management, Gaja Capital and Neo Asset Management.

Founded in 2000 by Srikanth Velamakanni and Pranay Agrawal, Fractal Analytics offers AI and data-driven solutions in domains such as computer vision, quantum computing and cognitive automation. Its GenAI offerings include Flyfish, Fractal GPT and Arya.

The AI firm’s clients includes Fortune 100 and 500 companies such as Google, Wells Fargo and Reckitt Benckiser. Fractal became a unicorn in early 2022 when it raised $360 million from TPG Capital Asia.

Fractal in March announced that it made a strategic investment of $20 million into one of its product companies, Asper.ai, an AI platform for consumer goods and manufacturing.

The funds will be used for Asper’s next phase of growth, by scaling product development and expanding enterprise customer base globally.

Road to IPO

Fractal Analytics plans to soon file the draft red herring prospectus for an initial public offer (IPO) with the Securities and Exchange Board of India, sources told Moneycontrol.

The IPO size is likely to be in the $500-600 million range and will comprise a large share of secondary share sales by existing investors.

Fractal counts marquee private equity investors such as TPG Capital and Apax Partners as its investors.

The quantum of secondary stake sales is yet to be finalised and hence the final size of the IPO is still unclear, the sources said. To date, Fractal has raised around $855 million.