ESDS Shares Triple Post-IPO, Hit Upper Circuit For Third Day
ESDS Software Solution shares hit the 20% upper circuit for a third consecutive session, trading over 200% above their IPO price.
Shares of enterprise cloud and AI company ESDS Software Solution Ltd. Hit the 20% upper circuit for the third consecutive session on Tuesday. The stock, locked at ₹1,289.55 on the BSE, now trades at more than three times its initial public offering (IPO) issue price of ₹429.
This surge gives ESDS a market capitalisation of ₹15,114.9 crore ($1.6 billion). On the National Stock Exchange (NSE), the stock was locked at ₹1,308.05 as of 12:36 PM IST, representing a gain of 204.9% from the issue price.
Post-IPO Trading Performance
ESDS made its stock market debut on Friday, September 4. It listed at ₹757 on the NSE, a 76.5% premium to the issue price. On the BSE, it debuted at ₹746.30, a nearly 74% premium.
The shares hit their 20% upper circuits on the very first day of trading. They have remained locked at those limits in every session since.
| Exchange | Debut Price (₹) | Premium Over Issue Price | Price on Sept 6 (₹) | Gain From IPO Price |
|---|---|---|---|---|
| NSE | 757 | 76.5% | 1,308.05 | 204.9% |
| BSE | 746.30 | ~74% | 1,289.55 | 200.6% |
Analyst Coverage and Growth Projections
Amid the rally, Choice Institutional Equities initiated coverage on ESDS with a 'buy' rating. The brokerage set a target price of ₹1,550 per share.
Choice expects ESDS's $1.25 billion AI infrastructure contract with Australia-based Sharon AI to be a primary growth catalyst. It projects the company's operating revenue will surge nearly 9.7 times, from ₹472 crore in FY26 to ₹4,581 crore by FY28. This growth is tied directly to the ramp-up of its AI infrastructure business.
The stock's rapid ascent has narrowed the potential upside from the brokerage's target. While the ₹1,550 target represented a 71% gain from a reference price of ₹908, the subsequent rally means the potential upside is now just 18.5% from the current NSE price.
Choice also flagged several risks. The execution of the Sharon AI contract is a key concern. Other risks include customer concentration, the capital-intensive nature of ESDS's expansion, and growing competition in cloud and AI infrastructure.
IPO Details and Fund Allocation
The company's ₹720 crore IPO, which was entirely a fresh issue of shares, was subscribed 135.88 times overall. The qualified institutional buyer (QIB) portion was subscribed a massive 261.51 times.
Prior to the IPO, ESDS raised ₹216 crore from anchor investors. It allotted 50.34 lakh shares at ₹429 each to funds including Motilal Oswal Mutual Fund, Bandhan Mutual Fund, Quant Mutual Fund, ITI Mutual Fund, and JM Flexicap Fund.
ESDS plans to use ₹576 crore, or 80% of the IPO proceeds, to purchase and install cloud-computing equipment and data-centre infrastructure. The remaining funds are earmarked for general corporate purposes.
Company Background and Financials
Founded in 2005 and based in Nashik, ESDS provides cloud computing, data centre, managed services, and AI-led digital infrastructure solutions. Its clients include government and enterprise customers in India and overseas.
The company operates across infrastructure-as-a-service (IaaS), managed services, and software-as-a-service (SaaS) models. It serves the banking, financial services, government, and enterprise segments.
According to the report, ESDS's operating revenue increased 30.7% year-on-year to ₹472.2 crore in FY26 from ₹361.3 crore in the previous fiscal. Its consolidated net profit more than doubled to ₹120.8 crore from ₹55.6 crore during the same period.
