Fractal Analytics (FRACTAL IN) – Annual Report Analysis – Assets reusability complements margins improvement – BUY
Published on 31 Aug 2026
FRACTAL’s FY26 annual report suggests that despite macro uncertainties, its enterprise clients continue to make AI investments to achieve competitive advantage, operational agility and margin expansion. The enterprise stickiness is reflected in NRR (+117%), elevated NPS (78) and steady USD growth (11%/15% YoY) in its top 10/20 accounts in FY26. Fractal.ai revenue growth (+14% YoY in USD) was largely supported by HLS (~19% of revenue), up 59% YoY, while the overhang from TMT (~25% of revenue), which declined ~5% YoY, weighed on overall Fractal.ai revenue. The TMT overhang appears to have largely stabilized, while the momentum in rest of the BUs (ex-TMT 22% YoY in USD) along with a multi-year deal (USD17mn+), with a leading US healthcare enterprise, should support growth in FY27 and beyond. Additionally, the company is promoting the adoption of Cogentiq within enterprise setup to standardize repeatable deliveries, drive productivity and enable greater execution consistency across multiple engagements. We continue to maintain our positive stance on the stock and retain our ‘BUY’ rating.
