Fusion CX IPO: Brokerages mixed; customer concentration a key concern

Fusion CX IPO review: Brokerages have shared mixed ratings on Fusion CX Ltd IPO. SBI Securities has recommended 'Subscribe' rating, while Swastika has rated it 'Neutral'.

Fusion CX IPO review:Fusion CX Ltd IPO is set  to open for subscription today. The AI-powered customer experience solutions provider has fixed the price band of ₹275-289 per share for its ₹702 crore IPO.

 

At the upper end of the price band, Fusion CX is expected to command a post-issue market capitalisation of over ₹4,170 crore.

 

While the three-day public issue will close on October 16, the bidding by anchor investors took place on Tuesday. The firm raised ₹315 crore from anchor investors at ₹289 per equity share. 

Fusion CX IPO review

 

Brokerages have shared mixed ratings on Fusion CX Ltd IPO. SBI Securities has recommended 'Subscribe' rating, saying increasing adoption of AI-led customer engagement solutions will supports growth in the long run.

 

 

At the upper price band of ₹289, the brokerage added that the issue is valued at a FY26 Restated/Proforma P/E multiple of 24.6x/22.0x respectively on post issue capital (PEG ratio <1) which appears to be reasonable as compared to its peers in the backdrop of robust return ratios.

 

"Given the company’s scalable global delivery model, expanding AI led digital service offering, strong cash flows and robust growth prospects across various verticals such as healthcare, telecom, BFSI, etc., we recommend SUBSCRIBE for the long-term investment horizon. However, customer concentration and the execution of AI-led initiatives remains key monitorable," SBI Securities said.

 

Fusion CX had reported revenue/ Ebitda/ PAT CAGR of 35.4 per cent/ 99.5 per cent/ 116.4 per cent, respectively, over FY24-FY26 period. 

Fusion CX financials

 

Swastika has rated it 'Neutral', saying the valuation is broadly in line with peers, which limits the re-rating potential. It also observed that customer concentration is high, with the largest client contributing 30.05 per cent of FY26 revenue.

 

"The issue leaves modest money on the table for short-term listing flippers, but offers a reasonable fundamental entry for long-term investors seeking a high-RoE, debt-reducing BPO/KPO player trading under 20x FY26 earnings," it said. Check - TOP GAINERS NSE | TOP LOSERS NSE

 

Fusion CX IPO GMP

 

In the grey market, Fusion CX shares are commanding a moderate premium of around 8-9 per cent. At the last check, Fusion CX shares were trading at ₹314, implying a grey market premium (GMP) of ₹25 or 8.65 per cent.

 

Fusion CX IPO allotment will likely be finalised on October 19 and listing will take place on October 22 on both the bourses BSE and NSE. 

 

Fusion CX provides multichannel customer support and business process solutions through voice, email, chat, social media, and messaging. 

Disclaimer: Views and outlook in this report belong to the brokerages and analysts cited. They do not reflect the views of Business Standard. Readers are advised to exercise discretion.