New Delhi, Sept. 9 -- ESDS Software Solution share price has been on fire since listing. The strong debut was followed by another sharp upward move, taking the stock's gains to around 230% from its IPO issue price.
Just today, 9 September, the stock hit its 10% upper circuit of Rs.1,418.50 per share on BSE. In the last 2 sessions as well, the stock had hit its 20% upper circuit.
ESDS Software Solution shares were listed at Rs.757 on the NSE on 4 September, a 76.46% premium over the IPO issue price of Rs.429 per share. On the BSE, it opened at Rs.746.30, a 73.96% premium over the issue price.
Investors who received shares in the IPO have seen their investment more than tripled in just four trading sessions. On the listing day itself, Friday, September 4, the stock had surged around 112%.
After a stock delivers a strong listing-day performance, the next question for investors is often whether the rally still has room to run or whether it is time to wait for a more attractive entry point.
Brokerage firm Choice Equity Broking has initiated coverage on ESDS Software Solutions with a 'buy' recommendation and assigned a target price of Rs.1,550, indicating an upside of another 20% from its previous close of Rs.1,289.55.
Choice believes ESDS represents one of the most compelling listed opportunities for investors seeking exposure to India's structural expansion in cloud computing, data centres and AI infrastructure. The brokerage highlighted the company's full-stack capabilities spanning cloud, managed infrastructure and data centre services as a key differentiator.
"Growth is underpinned by capacity expansion, deeper customer monetisation and operating leverage, with the $1.25 billion AI contract adding a significant new leg to the earnings trajectory," said Choice.
The brokerage expects ESDS Software Solution to deliver strong growth over the forecast period. Revenue, EBITDA and PAT are estimated to grow at 120.9%, 72.6% and 81.3% CAGR, respectively, over FY26-29E. Choice expects this expansion to be driven by continued momentum in the core business as well as the gradual ramp-up of revenues from its AI infrastructure operations.
"Our 18 times FY28E EV/EBITDA valuation implies nearly 31 times FY28E forward P/E, which we believe appropriately reflects ESDS's strong growth profile. Successful execution and faster ramp-up of the AI contract could provide further upside to earnings and valuation," it added.
The company's growth outlook has also attracted a positive view from Shivani Nyati, Head of Wealth at Swastika Investmart. According to Nyati, the earlier positive assessment of ESDS was supported by sharp margin expansion, nearly nine-fold growth in profit after tax (PAT) and strong customer stickiness.
She further pointed to India's rising requirements for cloud computing, data-centre infrastructure, cybersecurity and digitalisation as structural growth drivers that could benefit ESDS over the long term.
Nyati said these factors support a constructive medium-to-long-term outlook for the company, even after the stock's sharp post-listing rally. At the same time, the magnitude of the recent gains has altered the near-term risk-reward equation for investors.
ESDS Software Solution launched its IPO for public subscription on Friday, 28 August, with the issue closing on Tuesday, 1 September. The offering attracted exceptionally strong demand. By the final day of bidding, the public issue had been subscribed 135.88 times.
The IPO comprised entirely of a fresh issue of equity shares worth up to Rs.720 crore, with no offer-for-sale component. The company had set the price band at Rs.408-429 per share.
ESDS Software Solution is an AI-enabled provider of cloud, managed services, data centre infrastructure and software solutions in India.
The company is one of only two players in India offering a complete suite that brings together GPU-as-a-Service (GPUaaS), cloud, managed services, data centre infrastructure and software solutions. Its customer base is spread across several industries and customer categories.
During fiscal 2026, ESDS Software Solution served more than 2,500 customers, including clients across banking, financial services and insurance (BFSI), public sector organisations, businesses and enterprises.
The company's financial performance has also improved considerably over the past three financial years. Profit attributable to owners followed a similar trajectory. It stood at Rs.12.57 crore in FY24, climbed to Rs.55.61 crore in FY25 and increased further to Rs.120.28 crore in FY26. Meanwhile, revenue from operations increased from Rs.286.52 crore in FY24 to Rs.361.34 crore in FY25, before rising further to Rs.472.21 crore in FY26.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions. Published by HT Digital Content Services with permission from MINT. For any query with respect to this article or any other content requirement, please contact Editor at contentservices@htdigital.in