ESDS Hits Upper Circuit For Fourth Straight Day, Rises To 3.3X IPO Price

Riding the bulls since listing last Friday, stock of enterprise cloud and AI company ESDS Software Solution hit an upper circuit of 10% for the fourth consecutive session today, taking the stock to more than three times its IPO issue price. 

The stock is locked at a 10% upper circuit of ₹1,418.50 on the BSE today (September 9), with market capitalisation to ₹16,626.38 Cr ($1.75 Bn). On the NSE, the stock was locked at ₹1,438.85 as of 15:07 IST.

At these levels, ESDS’ shares are trading 3.3X above its IPO issue price of ₹429 apiece on the BSE. This is also a 90% jump from its listing price of ₹746.30.

ESDS made its stock market debut on September 4, listing at ₹757 on the NSE, a premium of 76.5% over its issue price. On the BSE, the stock debuted at ₹746.30, a premium of nearly 74%. 

The shares subsequently hit their 20% upper circuits at ₹908.40 on the NSE and ₹895.55 on the BSE on the listing day and have remained locked at upper circuit limits since then.

ESDS had set a price band of ₹408 to ₹429 per share for the public issue, seeking a valuation of about ₹5,028 Cr (about $527 Mn). The company’s ₹720 Cr IPO comprised entirely a fresh issue of shares. 

The IPO was fully subscribed within hours on the first day of bidding, and closed with an oversubscription of 135.88X. Qualified institutional buyers showed the most appetite for the AI company, oversubscribing their quota by 261.51X. 

Ahead of the IPO, ESDS raised ₹216 Cr from anchor investors by allotting 50.3 Lakh shares to 19 entities at ₹429 apiece. The anchor investors included Motilal Oswal Mutual Fund, Bandhan Mutual Fund, Quant Mutual Fund, ITI Mutual Fund, and JM Flexicap Fund, among others.

On the financial front, ESDS reported a consolidated net profit of ₹120.8 Cr in FY26, more than double the ₹55.6 Cr it posted in the previous fiscal year. Its operating revenue rose 30.7% to ₹472.2 Cr from ₹361.3 Cr in FY25.

Founded in 2005, Nashik-based ESDS provides cloud computing, data centre, managed services, and AI-led digital solutions to government and enterprise customers.

Brokerage firm Choice Institutional Equities sees a sizeable growth opportunity for ESDS in India’s cloud and AI infrastructure market. The brokerage expects India’s cloud market to grow at a 23.6% CAGR from ₹65,100 Cr in FY25 to ₹1.90 Lakh Cr by FY30, driven by enterprise digitisation, greater adoption among BFSI players and rising government workloads.

Choice also sees India’s cloud GPU market growing at around 50% CAGR through FY30. This could expand ESDS’ addressable market beyond its core cloud business into GPU-as-a-Service (GPUaaS), GPU colocation and AI-led managed infrastructure.

The brokerage said ESDS’ exposure is diversified across enterprise, government and BFSI customers, which account for 55.1%, 27.4% and 17.5% of its business, respectively. It also expects increasing data-residency and compliance requirements to favour domestic infrastructure providers.

“India’s underpenetrated cloud market offers a durable growth runway, with AI adding a higher-growth layer,” Choice said.

The brokerage has initiated coverage on ESDS with a ‘Buy’ rating and a target price of ₹1,550, implying further upside from the stock’s current level.

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