IPO-Bound Capillary Technologies Posts INR 1 Cr Profit In H1 FY26

IPO-bound Capillary Technologies turned profitable in the first half of the ongoing financial year (H1 FY26), posting a consolidated net profit of INR 1 Cr as against a loss of INR 6.8 Cr in the same period last year.

Notably, the SaaS company got a tax credit of INR 51.7 Lakh in H1 FY26. Without it, it would have posted a net profit of around INR 50 Lakh. 

Its operating revenue surged 25% to INR 359.2 Cr during the period under review from INR 287.2 Cr in the year-ago period.

Founded in 2008 by Aneesh Reddy, Capillary Technologies specialises in providing loyalty management and customer engagement platforms to its customers. It helps businesses across industries improve customer engagement, drive sales and build brand loyalty through its AI-powered platform.

The company earns revenue from multiple streams, including retainership and other services, installation, and campaign services. 

In H1 FY26, retainership and other services (which include revenue from subscription to cloud software products and solutions with the customers) was the highest contributor to the top line at INR 321.1 Cr, up 41% from INR 228 Cr in H1 FY25. Installation brought in a revenue of INR 34.5 Cr, while campaign services raked in INR 3.6 Cr revenue. 

Including other income of INR 3.3 Cr, the customer engagement and loyalty solutions provider reported a total income of INR 362.6 Cr in H1 FY26. This was a 22% increase from INR 296.8  Cr in H1 FY25.

The company’s EBITDA rose 65% to INR 39.8 Cr from INR 24.1 Cr in H1 FY25. EBITDA margin improved to 11% from 8% a year ago.

In FY25, Capillary Technologies had posted a net profit of INR 13.3 Cr as against a loss of INR 59.4 Cr in the previous fiscal year. Operating revenue stood at INR 598.3 Cr, marking a 14% jump from INR 525.1 Cr in FY24. 

Capillary Technologies’ IPO is set to open on November 14, comprising a fresh issue of INR 345 Cr and an offer for sale of up to 92.29 Lakh shares. The company’s shares are expected to list on the exchanges on November 21. 

The company plans to use the fresh issue proceeds for setting up cloud infrastructure, research and product development, procurement of computer systems, and the remaining amount for unidentified acquisitions and general corporate purposes.

Where Did Capillary Technologies Spend? 

Capillary Technologies’ total expenses rose 18% to INR 322.7 Cr in H1 FY26 from INR 272.7 Cr in the year-ago period. Let’s take a look at the breakdown of expenses: 

Professional & Consultancy Expenses: The spending under the head rose 30% to INR 61.5 Cr in H1 FY26 from INR 47.5 Cr a year ago. 

Software & Server Charges: The company spent INR 63.9 Cr on this, up 45% from INR 44.2 Cr in H1 FY25.

Employee Benefit Expenses: Capillary Technologies’ employee costs grew 12% to INR 174.3 Cr during the period under review from INR 155.2 Cr in H1 FY25.

Other Expenses: The spending under this head, which included travelling and conveyance, business promotion expenses and loss allowances under the expected credit loss model, among others, declined 10% to INR 23.1 Cr from INR 25.6 Cr in H1 FY25.