Capillary Technologies Refiles For IPO

A couple of weeks after receiving the board approval for an INR 2,250 Cr IPO, SaaS company Capillary Technologies has filed its draft red herring prospectus (DRHP) with the SEBI for its initial public offering. 

The company’s IPO will consist of a fresh issue of INR 430 Cr and an offer for sale (OFS) component comprising 18.3 Mn shares. The company bids to list on NSE and BSE post its IPO. On June 3, Inc42 reported that the company’s board had approved of an IPO comprising a fresh issue of INR 500 Cr and an OFS component of INR 1,750 Cr.

The selling shareholders of Capillary include Ronal Holdings, Trudy Holdings, Filter Capital India, Sripathi Venkata Ramana Reddy, Harminder Sahni, Adarsh Reddy B, Sudhakar Reddy Katanguri, Sripathi Damodar Reddy and Manjunath Nanjaiah.

The company plans on utilising the fresh capital raise from the IPO in the following fashion:

— INR 120 Cr investment has been earmarked for building up its cloud infrastructure. 

— INR 151.5 Cr will be invested in research, design and development of its products and platform.

— INR 10.3 Cr will be used to purchase computer systems for the company. 

— The company plans to utilise the remainder of the capital for acquisitions and general corporate purposes. 

Founded in 2008 by Aneesh Reddy, Capillary Technologies specialises in providing loyalty management and customer engagement platforms to its customers. It helps businesses across various industries improve customer engagement, drive sales and build brand loyalty through their AI-powered platform. It counts the likes of Tata Digital, Domino’s, Aditya Birla Fashion & Retail, Arvind Fashion, among over 390 clients. 

This is Capillary Technologies’ second attempt to get listed, having taken a stab at an INR 850 Cr IPO in 2021. However, it deferred its IPO plans owing to market conditions and a desire to wait for a more favorable environment. 

After deferring its IPO plans, the company netted $140 Mn in 2024 in its Series D funding round. It is backed by the likes of Qualcomm Ventures, Norwest Venture Partners, Avataar Ventures, Filter Capital, InnoVen Capital, Peak XV Partners, American Express Ventures, among others.

Inc42 reported in January that the company has restarted the preparations for its IPO and is likely to file the draft papers for a $200 Mn (INR 1,700 Cr) public offering by June this year.

On the financial front, the company turned profitable in FY25. Capillary registered a profit of INR 13.3 Cr in the financial year under review as against a loss of INR 59.4 Cr in FY24.

The company’s operating revenue stood at INR 598.3 Cr, marking a 14% jump from INR 525.1 Cr in the fiscal prior. Including an other income of INR 13.6 Cr, the company’s total revenue for the fiscal stood at 611.9 Cr, marking a 14% year-on-year (YoY) uptick. 

Meanwhile, its total expenditure for the fiscal stood at INR 533.3 Cr, down slightly from the INR 536.9 Cr it spent in FY24. With this, the company’s EBITDA profit for the fiscal year stood at INR 78.6 Cr as against an EBITDA loss INR 1.5 Cr in FY24.