Capillary Technologies India IPO 2025 – A Growth Play in SaaS Loyalty & Customer Engagement
India’s enterprise software (SaaS) ecosystem is evolving rapidly, and the listing of Capillary Technologies India Ltd (“Capillary” or “the Company”) offers investors a chance to participate in a business anchored in AI-driven customer loyalty and engagement solutions. The IPO marks a key step for the Bengaluru-based company as it transitions to public markets.
Company & Sector Context
Capillary Technologies India is a cloud-native, AI-enhanced Software-as-a-Service (SaaS) company that provides loyalty management platforms, customer data platforms (CDP), predictive analytics and engagement solutions to enterprise clients.
The company supports hundreds of brands across more than 45 countries. As at March 31, 2025, Capillary had offices in India, United States, United Kingdom, UAE, Singapore, Indonesia, Vietnam and Malaysia.
Founded in 2008 by alumni of the Indian Institute of Technology (IIT) Kharagpur, the company has evolved through multiple acquisitions and global expansion phases.
The sector context is positive: With digital transformation initiatives accelerating across retail, consumer goods, banking & financial services, telecom, and other sectors, enterprise customers are increasingly investing in SaaS platforms for engagement, loyalty, analytics and data-driven growth. Capillary aims to ride this tailwind.
IPO Structure & Key Details
- Capillary filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) in June 2025, proposing a fresh issue of ₹430 crore and an Offer-For-Sale (OFS) of up to 18.3 million shares by existing shareholders.
- The fresh issue proceeds will be used for: ~₹120 crore for cloud infrastructure costs; ~₹151.54 crore for research, design and development of products/platform; ~₹10.32 crore for computer systems; and the balance for inorganic growth (acquisitions) and general corporate purposes.
- The company has received SEBI nod for the IPO.
- The IPO opening date is expected around 14 November 2025, with anchor book starting 13 Nov and listing projected ~21 Nov. The company has revised the offer size to ~₹345 crore fresh issue and a smaller OFS of ~92.28 lakh shares.
Financials & Growth
- For FY25, Capillary reported operating revenue of ~₹598 crore, up ~14% year-on-year from ~₹525 crore in FY24.
- Net profit for FY25 is ~₹13.2 crore compared with a net loss of ~₹59.8 crore in FY24 — marking a turnaround to profitability.
- The company’s strategy includes organic growth plus acquisitions, and global expansion into markets outside India.
Strengths
- Domestic and global SaaS presence: Capillary serves enterprise clients across geographies and industries, giving diversification beyond India alone.
- Turnaround achieved: The move to profitability enhances credibility and investor confidence in its business model.
- Use of proceeds is growth-oriented: Investments in cloud infrastructure and R&D suggest the company is committed to scaling and innovation.
- Tailwinds in the loyalty/engagement space: As brands focus more on customer retention, personalised experiences, data analytics and loyalty platforms, Capillary stands to benefit.
Key Risks & Considerations
- Competition: The SaaS space, especially loyalty, engagement and CDP platforms, is crowded and evolving rapidly. Capillary will need to maintain differentiation and scale to defend its position. The DRHP itself flags “rising competition, AI impact and macro-uncertainties” as risks.
- Execution risk: Investments in cloud infrastructure and product development require time, and global expansion (including acquisitions) introduces integration and execution complexity.
- Valuation & growth expectations: With the IPO market focused heavily on growth and future potential, investors must assess whether the current financials and growth pipeline justify the valuation being placed.
- Market dependency: The business is tied to enterprise spending — downturns, budget cuts or shifts in tech spending could impact growth.
- The OFS component means that part of the IPO proceeds is geared to exiting shareholders rather than purely to growth of the business — some investors may see this as less ideal than a purely fresh issue.
Why It Matters
Capillary’s IPO is significant for several reasons:
- It represents one of the relatively few Indian SaaS/tech companies listing domestically, offering public-market access to a business with global reach.
- It is a marker of investor interest in enterprise software of the loyalty/customer-engagement variety, beyond just consumer internet apps.
- For the company, the listing is a mechanism to scale further, strengthen its product platform, and access capital markets — a key moment in its lifecycle.
Investor Perspective: Key Takeaways
- For retail investors: Understand the minimum investment size (lot size depends on final price band); assess your risk-appetite and investment horizon — this is likely a medium-term growth story rather than a short-term flip.
- Evaluate the business’ growth path: Look for continued revenue growth, margin improvement, global expansion progress (especially in US/Europe), and successful execution of R&D/cloud infrastructure initiatives.
- Track competitive dynamics: How Capillary distinguishes itself and scales in a competitive global SaaS market will matter.
- Valuation discipline: Ensure you compare the IPO valuation metrics with other listed SaaS peers (domestic and global) to judge whether it’s fairly priced.
- Post-listing, monitor key metrics: revenue growth rates, profitability/margin improvements, customer retention/churn, international vs domestic split, and acquisitions/integration outcomes.
Conclusion
The Capillary Technologies India IPO offers a compelling story: a SaaS company with global reach, a recent turnaround to profitability, a clear growth strategy and favourable sector dynamics. While the opportunity is attractive, it is not devoid of risk — execution, competition and valuation are real considerations. For investors with conviction in enterprise SaaS, customer-engagement platforms and longer‐term potential, this IPO merits serious attention. For those seeking ultra-short-term gains or low-risk exposure, caution is advised.
(Disclaimer: Recommendations, suggestions, views and opinions expressed by experts are their own. Investors are advised to consult certified financial advisors before making any investment decisions.)
