Fractal, Meesho Shares Drop Over 6% Following Q1 Results

New-age technology firms Fractal and Meesho saw their stock prices decline by over 6% each following the announcement of their Q1 FY27 financial results. The drop impacted trading on Indian stock exchanges on Thursday.

Fractal, an AI and advanced analytics company, experienced a significant slide, with its shares falling as much as 7.5% to a low of ₹797 on the BSE. The company, with a market capitalization of approximately $1.42 billion, reported a nearly 92% jump in profit after tax to ₹72.3 Cr, but missed internal expectations, particularly in the technology, media, and telecom (TMT) vertical.

E-commerce platform Meesho also saw its shares slip by up to 6% to ₹177.6. The company reported a narrowed net loss of ₹132.8 Cr, a 54.1% improvement year-on-year, and a 48% increase in operating revenue to ₹3,707 Cr. Despite these improvements, investors reacted negatively to Meesho's weak outlook for the second quarter.

Fractal's CEO Srikanth Velamakanni acknowledged underperformance, attributing it partly to shifting spending patterns among large tech companies increasing AI capital expenditure while pressuring operating expenses. He stressed the need for Fractal to "reimagine" itself to better serve TMT clients, noting a decline in clients generating over $20 million in revenue.

Meesho's cautious Q2 forecast stems from an anticipated moderation in net merchandise value (NMV) growth. This is partly due to the shifting of its major sale event to Q3 from Q2, creating an unfavorable year-on-year comparison. The company also plans to increase customer acquisition and marketing investments, which may moderate margin expansion.