Capillary Technologies IPO open for subscription: Business model, financials, strengths and risks explained

Capillary Technologies IPO: Software product company, Capillary Technologies India has launched its much-awaited public issue on November 14, 2025.

The company offers AI-based Software-as-a-Service (“SaaS”) products and solutions primarily to enterprise customers. As per the company, it is a global leader in loyalty and engagement management solutions. The company’s products and services assist clients in generating engagement, driving conversions and boosting repeat sales.

Capillary Technologies IPO details

Capillary Technologies IPO aims to raise ₹877.50 crore through its public issue, which is a 100% book-built and includes a fresh issue and offer-for-sale of over 1.5 crore shares

The company has fixed the price band of the issue at ₹549 to ₹577 per share. The lot size, or the minimum bid quantity to apply for the issue, is 25 shares. This equates to a minimum investment amount of ₹14,425 per lot at the upper end of the price band for retail investors.

Capillary Technologies has appointed JM Financial as the book-running lead manager of the IPO, while MUFG Intime India Pvt.Ltd is the registrar for the issue.

Capillary Technologies IPO timeline

Capillary Technologies IPO will remain open for bidding from November 14 to November 18, 2025. After the bidding is closed, the allotment of shares is expected to be finalised on November 19.

Successful bidders can expect the shares to be credited to their demat accounts by November 20, with others receiving refunds on the same day. Capillary Technologies shares are scheduled to list on the BSE and NSE on November 21, 2025.

Financial snapshot

Capillary Technologies IPO objective

• Cloud infrastructure costs: The company will use ₹143 crore towards funding its cloud infrastructure costs.
• Investment in development of products and platform: The company will use ₹71.58 crore to invest in research, designing and development of its products and platform.
• Purchase of computer systems: The company will use ₹10.34 crore towards investment in the purchase of computer systems for the business.
• General corporate purposes: Part of the IPO proceeds will be used for general corporate purposes and unidentified acquisitions.

About the company

Over the past decade, the company has established a strong foothold in the loyalty technology market, serving 19 Global Fortune 500 clients across sectors such as retail, BFSI, telecom, travel, auto, and healthcare. As of September 2025, it served 413 brands and hosted 1.82 billion consumers on its platform, up from 1.46 billion in September 2024 and 1.26 billion in March 2025. It services enterprise clients across 47 countries.

The company operates through a comprehensive suite of AI-driven products, such as Loyalty+, Engage+, Insights+, and Rewards+. Its Customer Data Platform (CDP) helps businesses handle omnichannel engagement, predictive analytics, and customised loyalty programs. The company has a diversified business vertical with 30.01% of revenue from the retail industry, 17.59% from healthcare, 16.23% from BSFI and other industries such as consumer packaged goods, travel, automobiles and hospitality, energy retail and more in H1FY26.

Capillary Technologies has 16 offices, including in key markets of India, the United States, the United Kingdom, Canada, the United Arab Emirates, Singapore, Indonesia, Vietnam and Malaysia as of September 2025.

In the six months ending in September 2025, the company's Net Revenue Retention (NRR) was 115.42%, and its churn rate was 9.64%, indicating steady opportunities for upselling and cross-selling. The company has long-term relationships with an average length of over 2.5 years with its top 10 customers, as of September 30, 2025. Its clientele includes major players such as Tata Digital, ABFRL, Metro Brands, Puma, and Dominos Indonesia.

The company has strategically expanded through acquisitions and successfully integrated entities such as Persuade Group, Brierley & Partners and Kognitiv Group. It also developed a new product named Rewards+ by utilising the assets of the Digital Connect business that it acquired from Tenerity LLC in June 2023. These integrations have increased its presence across North America and Europe while improving contribution margins within acquired businesses.

Strengths and opportunities

• Market leader in AI-led loyalty solutions: The company is a trusted partner in the global loyalty management and CRM industry with a decade-long track record. Recognised as a leader and a strong performer by Forrester, Gartner, Everest, and Zinnov, it serves Fortune 500 clients across sectors. Its flagship AI-driven SaaS platforms, such as Loyalty+, Engage+, Insights+, and Rewards+, enable enterprises to run end-to-end loyalty programs with deep consumer analytics and engagement. The firm’s consumer base has grown to 1.82 billion users as of September 2025, highlighting its scale and reliability.
• Scalable, cloud native infrastructure: Built on a cloud-based, API-first architecture, the company’s platform processes up to 0.16 million loyalty transactions per hour and 15.67 billion number of loyalty transactions have been processed as of September 2025.
• Strong and diversified customer base: The company maintains long-term relationships with marquee brands such as Tata Digital, ABFRL, Puma, Dominos Indonesia, and InterGlobe Aviation, alongside 19 Global Fortune 500 companies. Revenue from enterprise clients accounted for over 98.23% of total operations as of September 2025. Net revenue retention stood at 115.42% for the same period, with churn contained at 9.64%, underscoring strong client stickiness and recurring growth potential.
• AI-driven innovation: The firm’s AI suite, including Creatives Co-Pilot, Promotions Co-Pilot, and aiRA (AI Retail Assistant), enables real-time personalisation, predictive analytics, and campaign automation. These innovations strengthen customer engagement and create measurable ROI for clients. It also hosts events such as ‘Captivate’ to explore how digital innovation is reshaping customer loyalty management.

Risks and Threats

• Revenue concentration risk: The company’s business remains dependent on a few key enterprise clients, with the top 5 customers contributing 38.60% and the top 10 customers 55.70% of revenue in H1FY26. Such concentration exposes it to contract renewal or pricing risks. The loss of any client could materially affect revenue momentum and cash flow visibility.
• Customer acquisition cost risk: The company’s growth depends on its ability to attract new customers efficiently. In H1FY26, customer acquisition cost stood at ₹65.48 crore, representing 18.23% of net revenue, compared to 17.61% in H1FY25 and 17.85%, 18.05%, and 25.88% in FY25, FY24, and FY23, respectively. Rising acquisition costs and slower ramp-up in smaller accounts may delay breakeven on new contracts.
• High employee cost and attrition risk: The company had 737 employees as of September 30, 2025, with an attrition rate of 8.91% and 678 employees with an attrition rate of 19.03% in FY25. Employee expenses amounted to ₹188 crore in H1FY26, representing 52.35% of revenue from operations. Given its heavy reliance on skilled engineers and product specialists, any rise in attrition or inability to attract and retain qualified talent could adversely impact operations, product development, and profitability.