Capillary Technologies IPO: Price Band Set! Huge Valuation Revealed - Will You Invest?

Capillary Technologies, a provider of AI-driven, cloud-native software for customer engagement and loyalty management, is set to launch its Initial Public Offering (IPO). The company has fixed its price band at INR 549 to INR 577 per share. This pricing values the company at approximately INR 4,576 Crore (around $515 million) at the higher end. The IPO consists of a fresh issuance of shares worth INR 345 Crore and an Offer for Sale (OFS) of up to 92.29 Lakh shares. The total IPO size is estimated to be around INR 877 Crore. Anchor bidding is scheduled for November 13, with the public subscription period running from November 14 to November 18. The company expects its shares to be listed on November 18.

Interestingly, Capillary Technologies revised its IPO size downwards from its initial draft filings. The funds raised from the fresh issue will be strategically allocated towards enhancing cloud infrastructure (INR 143 Cr), research, design, and product development (INR 71.6 Cr), purchasing computer systems (INR 10.3 Cr), and for unidentified acquisitions and general corporate needs. Founded in 2008 by Aneesh Reddy, the company offers a suite of products like Loyalty+, Engage+, and CDP to help brands manage loyalty programs and deliver personalized experiences to over 410 brands in 47 countries.

Financially, Capillary Technologies has shown a significant turnaround. It reported a net profit of INR 1 Crore in the first half of FY26, a substantial improvement from a loss of INR 6.8 Crore in the same period last year. Operating revenue saw a 25% year-on-year increase to INR 359.2 Crore. For the full FY25, the company posted a net profit of INR 13.3 Crore, compared to a loss of INR 59.4 Crore in FY24, with revenue growing 14% year-on-year to INR 598.3 Crore.

Impact: This IPO signifies a crucial step for Capillary Technologies, allowing it to raise capital for expansion and technological advancement. It also provides an exit opportunity for some existing shareholders and a potential investment avenue for the public. The company's improved financial performance and focus on AI-driven SaaS solutions make it an interesting prospect in the technology sector. Rating: 7/10

Difficult Terms: * **SaaS (Software as a Service):** A software distribution model where a third-party provider hosts applications and makes them available to customers over the Internet. * **IPO (Initial Public Offering):** The first time a company offers its shares to the public, becoming a publicly traded entity. * **Price Band:** A range within which investors can place their bids for shares during an IPO. * **OFS (Offer for Sale):** A process where existing shareholders sell their shares to new investors during an IPO, rather than the company issuing new shares. * **Anchor Bidding:** A process where institutional investors place their bids before the IPO opens to the public, guaranteeing a certain level of subscription. * **Cloud-Native Software:** Software designed to run in cloud computing environments, taking advantage of their scalability and flexibility. * **CDP (Customer Data Platform):** Software that creates a unified, persistent customer database accessible to other systems. * **FY26/FY25 (Fiscal Year):** Refers to the financial year ending March 31, 2026, or 2025, respectively.