Fractal Analytics and Aye Finance are very different bets: Fractal suits high‑risk, long‑term growth investors who want exposure to India’s first listed AI analytics platform at premium valuations, while Aye Finance fits investors seeking steadier, more reasonably‑priced financials exposure to India’s MSME lending story.

IPO snapshot: Fractal Analytics vs Aye Finance

Detail	Fractal Analytics IPO	Aye Finance IPO
Sector	Enterprise AI & analytics	MSME NBFC (small business loans)
Issue size	~₹2,834–4,900 crore (fresh + OFS; estimates vary by note)	₹1,010 crore (₹710 cr fresh + ₹300 cr OFS)
Price band	₹857–₹900, FV ₹1	₹122–₹129, FV ₹2
Lot size	16 shares (min ~₹13.7–₹14.4k)	116 shares (min ~₹14.2–₹15.0k)
Use of funds	R&D in generative AI, products, global expansion, debt reduction	Tier‑I capital, expand MSME loan book, tech & branch network

Business & valuation: how they differ

Fractal Analytics (AI & analytics)

• India’s first pure‑play AI / decision intelligence IPO, serving 100+ Fortune 500 clients across BFSI, CPG, retail, healthcare and tech.
• Sharp turnaround from ~₹55 crore loss (FY24) to ~₹221 crore profit (FY25) on 26% revenue growth; low net debt (~0.2×).
• Valuation: notes peg upper band at ~79× FY25 post‑issue P/E, no direct listed peer; called a “scarcity premium” AI play suited for 3–5 year high‑risk investors.

Aye Finance (MSME NBFC)

• NBFC lending small‑ticket business loans (avg ~₹1.5 lakh) to micro and small enterprises; AUM ~₹6,028 crore as of Sep 2025.
• Strong growth: FY24 PAT up ~291% to ~₹172 crore; RoE ~17%+, RoA ~3% (per summaries), but with rising credit costs and MSME‑linked NPA risk.
• Valuation: coming at about 18× P/E and ~2× P/B, cheaper than Fractal and broadly in line / slight discount vs some NBFC peers due to asset‑quality concerns.
• Fractal = growth + premium valuation + high risk, Aye = steadier compounding + more reasonable valuation + moderate risk.

Strengths – Fractal Analytics

• Category‑defining AI story: India’s first listed pure‑play enterprise AI / decision intelligence company with Fortune 500 clients across multiple verticals.
• Turnaround + operating leverage: Moved from FY24 loss (~₹55 cr) to FY25 profit (~₹221 cr) with 26% revenue growth and expanding margins.
• Asset‑light, IP‑driven model: High‑margin analytics services plus fast‑growing SaaS subscriptions (167% YoY), low net debt (~0.2×).
• Large global AI TAM: Benefits from worldwide spend on data, cloud and generative AI; no direct listed peers → scarcity premium.
• Use of proceeds: R&D, products, global sales, and selective acquisitions to deepen AI capabilities and expand internationally.

Risks – Fractal Analytics

• Very expensive valuation: ~79× FY25 P/E at upper band, with high expectations baked in; any growth miss can hurt.
• Client concentration: Meaningful share of revenue from a few large global tech/financial clients; loss of a key account could dent earnings.
• Cyclical IT/consulting budgets: Dependent on US/EU enterprise tech spending; macro slowdown or AI spending pause is a risk.
• Execution on product/SaaS: Scaling products needs sustained R&D and GTM investments, which can pressure margins.
• Large OFS component: Significant secondary sale by PE investors (TPG, Apax), raising questions around near‑term upside vs exit for existing holders.

Strengths – Aye Finance

• Focused MSME lender: Clear niche in small‑ticket loans to micro‑enterprises, addressing India’s MSME credit gap.
• Healthy profitability metrics: Strong PAT growth (~291%), RoE in mid‑teens, RoA ~3% with diversified geographic presence.
• Reasonable valuation: About 18× P/E and ~2× P/B, more in line with NBFC peers, offering valuation comfort vs Fractal’s premium.
• Structural demand: MSME lending tied to domestic consumption and small‑business growth, providing steady tailwinds.
• Capital boost from IPO: Fresh ₹710 crore strengthens Tier‑I capital, allowing expansion of the loan book without over‑leveraging.

Risks – Aye Finance

• Credit risk: MSME borrowers are vulnerable to economic shocks; NPAs and credit costs could rise if slowdown or stress emerges.
• High leverage vs tech: As a lender, Aye naturally runs higher debt‑to‑equity, amplifying asset‑quality cycles.
• Regulatory overhang: RBI guidelines on NBFCs (capital, provisioning, governance) can impact profitability.
• Competition: Banks, SFBs and other NBFCs also chasing MSME segments, pressuring yields.
• Valuation still not “cheap‑cheap”: Seen at discount to some peers due to asset‑quality risk, despite headline 18× P/E sounding moderate.

So, which IPO to subscribe?

Based on broker and media comparisons:

• Choose Fractal Analytics IPO if:
  • You have high risk appetite, a 3–5+ year horizon, and want to play global AI and analytics growth through a scarce India‑listed name.
  • You are comfortable with rich valuation (≈79× FY25 P/E), higher volatility, and can tolerate near‑term swings for potential long‑term compounding.

• Choose Aye Finance IPO if:
  • You prefer steady domestic growth, cash‑flow‑backed lending and more reasonable valuations (~18× P/E, ~2× P/B).
  • You want exposure to India’s MSME credit story with moderate risk, while watching asset quality and credit costs.

• Barbell/Blend approach:
  • Some investors may split allocation: a smaller ticket to Fractal as a high‑beta, long‑term AI bet and a larger ticket to Aye Finance as a relatively stable financials play.

For most conservative to moderate‑risk investors, broker notes tilt slightly in favour of Aye Finance for listing + medium term, while positioning Fractal as a thematic, long‑term satellite allocation, not a core holding.

FAQs

1. Both IPOs open on the same dates. Can I apply to both?
Yes. Both open from 9–11 February 2026 and list on 16 February, and you can apply to both independently, subject to your capital, risk appetite and broker limits.

2. Which IPO is better for listing gains?
Grey market and brokerage notes suggest Aye Finance may offer better near‑term listing visibility due to more reasonable valuation, while Fractal’s listing could be volatile thanks to premium pricing and global AI sentiment. There is no guarantee of gains in either.

3. Which is better for long‑term (5+ years)?

• Fractal Analytics: Higher potential upside if it scales AI products, global clients and margins; but comes with valuation and execution risk.
• Aye Finance: Better suited for steady compounding if it maintains asset quality and grows AUM prudently.

4. How much should I allocate to each IPO?
As a thumb‑rule, keep higher‑risk bets like Fractal to a smaller slice (say 5–10% of equity portfolio) and core financials like Aye to a moderate slice, ensuring total IPO exposure fits your asset‑allocation and emergency‑fund needs. This is not personalised advice.

5. Are these IPOs suitable for first‑time investors?
First‑time investors with low risk tolerance may be better off starting with Aye Finance only or skipping both and focusing on diversified mutual funds/ETFs; Fractal, in particular, is more suitable for experienced investors comfortable analysing tech valuations and earnings risk.