ESDS Shares Triple From IPO Price, Hit 20% Upper Circuit For Third Straight Session

ESDS Software Solution's shares skyrocketed threefold from their initial public offering price, reaching over 20% above the 20% upper circuit for the third consecutive trading day. The company's market capitalization now stands at ₹15,114.9 Cr ($1.6 Bn) as its stock trades at ₹1,289.55 per share on the BSE, and ₹1,308.05 on the NSE.

This represents a staggering 200.6% increase from the IPO price of ₹429 apiece on the BSE, and 204.9% on the NSE. ESDS debuted on September 4 at ₹757 on the NSE and ₹746.30 on the BSE, both premiums of 76.5% and 74% respectively over their issue prices. During the initial listing day, shares hit their 20% upper circuit at ₹908.40 on the NSE, and ₹895.55 on the BSE, before remaining locked at these levels in the subsequent session.

Choice Institutional Equities has taken a bullish stance on ESDS, assigning a 'buy' rating with a target price of ₹1,550, representing a potential upside of 71% from its NSE reference price of ₹908. The brokerage anticipates the company's $1.25 Bn AI infrastructure contract with Australian firm Sharon AI as a key growth driver, with operating revenue projected to surge nearly 9.7X from ₹472 Cr in FY26 to ₹4,581 Cr by FY28.

However, the brokerage cautions the execution of the Sharon AI contract, customer concentration, capital-intensive expansion plans, and increasing competition in the cloud and AI infrastructure space as potential risks. ESDS raised ₹720 Cr from its ₹720 Cr IPO, which was 135.88X subscribed on the QIB portion, while its ₹216 Cr anchor investment was subscribed 261.51X.

Founded in 2005, Nashik-based ESDS offers cloud computing, data center, managed services, and AI-led digital infrastructure solutions to government and enterprise clients in India and abroad. ESDS operates across infrastructure-as-a-service (IaaS), managed services, and software-as-a-service (SaaS), serving banking and financial services, government, and enterprise segments.

The company plans to utilize ₹576 Cr, or 80% of IPO proceeds, for acquiring and installing cloud-computing equipment and other data center infrastructure, with the remaining funds earmarked for general corporate purposes. Operating revenue rose 30.7% YoY to ₹472.2 Cr in FY26, up from ₹361.3 Cr in the previous fiscal, while consolidated net profit more than doubled to ₹120.8 Cr from ₹55.6 Cr during the same period.