By Ashutosh Joshi
India’s hunt for listed data-centre and AI plays has a new favorite, and investors are already looking for what comes next.
ESDS Software Solution Ltd. has surged over 300% since its trading debut on Sept. 4, putting it on course to rank among India’s best-performing new listings. The rally may burnish the prospects for offerings from data-centre operator Sify Infinit Spaces Ltd., Yotta Data Services Pvt., which runs India’s largest cluster of Nvidia Corp. AI chips, and STT Global Data Centres India Pvt.
“ESDS’s success strengthens the case for more such companies to tap the market,” said Avinash Gorakshakar, founder of Avinash Mentor Research in Mumbai.
Despite a roughly $5 trillion equity market, investors have relatively few ways to gain meaningful exposure to cloud computing, data centres and AI infrastructure, sectors driving a global investment boom. That scarcity has helped turn ESDS and companies that feed the data-centre ecosystem, including fiber-optic makers Sterlite Technologies Ltd. and HFCL Ltd., into proxies for the theme.
Sterlite shares have surged more than 700% this year, while HFCL has more than tripled.
“Investors are pricing at least next two years of growth as data centres and its related infrastructure are among the few hot themes in India,” Gorakshakar said.
ESDS’s revenue may more than quadruple in the fiscal year ending March 2027 to nearly ₹2,300 crore from ₹470 crore, according to Kunal Bajaj, an analyst at Choice Institutional Equities. Bajaj, the lone analyst tracking the stock, said he plans to revise his ₹1,550 price target after the company reports quarterly earnings on Thursday.
A key driver of that growth projection is the company’s $1.25 billion cloud-capacity agreement with SharonAI Holdings Inc. The deal involves deploying 8,000 GPUs at one of the Nasdaq-listed firm’s existing data-centre providers in Australia.
At an IPO offer price of ₹429, ESDS’s enterprise value was 2.1 times the estimated revenue for the fiscal year ending March 2028, versus 11 times for peer E2E Networks Ltd., according to Bajaj. E2E shares have tripled this year.
Investor enthusiasm was evident even before trading began. ESDS’s roughly $80 million IPO drew bids for 136 times the shares on offer, while its sharp rally since listing ranks it among the strongest one-month performances for Indian IPOs that raised at least $20 million, according to data compiled by Bloomberg.
