ESDS Software Shares Hit Upper Circuit Again, Rally 150% Above IPO Price In Just Two Sessions

Shares of newly listed ESDS Software Solutions extended their stellar post-listing rally on Monday, surging around 150 percent above their IPO issue price in just two trading sessions and hitting the 20 percent upper circuit.

The stock rose 20 percent to Rs 1,090.05 on the NSE, its upper circuit limit, taking the company's market capitalisation to Rs 12,776.58 crore.

At the current price, ESDS Software has gained 154.09 percent over its IPO issue price of Rs 429 per share.

ESDS Software made its stock market debut on September 4 at Rs 757 on the NSE, a premium of 76.46 percent over the IPO price. On the BSE, the stock listed at Rs 746.30, up 73.96 percent from the issue price.

The company has emerged as one of only two IPOs in 2026 to have more than doubled investors' money from the IPO price on the listing day.

IPO Saw Massive Investor Demand

The Rs 720-crore IPO comprised an entirely fresh issue of 1.68 crore shares, with no offer-for-sale component.

The issue received an overwhelming response, getting subscribed 135.88 times during the three-day bidding period.

Qualified Institutional Buyers (QIBs) led the demand with 261.51 times subscription, followed by Non-Institutional Investors (NIIs) at 192.94 times and retail investors at 39.64 times.

Ahead of the IPO, the company raised Rs 206 crore from anchor investors, including Quant Mutual Fund, Bandhan Mutual Fund, Motilal Oswal Mutual Fund, Bajaj General Insurance and Samco Mutual Fund.

Choice Broking Initiates 'Buy'

Amid the sharp rally, Choice Broking initiated coverage on ESDS Software with a 'Buy' rating and a target price of Rs 1,550, implying an upside of around 42 percent from the current market price.

The brokerage expects ESDS Software's revenue to grow sharply over the next three years, estimating revenue at Rs 472 crore in FY26, Rs 2,263 crore in FY27, Rs 4,581 crore in FY28 and Rs 5,092 crore in FY29.

It also projects profit after tax to rise from Rs 120.8 crore in FY26 to Rs 719 crore by FY29, valuing the stock at 31x FY28 estimated earnings.

AI and Cloud Growth Seen As Key Triggers

Choice Broking said India's cloud services and cloud GPU markets remain key long-term growth drivers for ESDS Software.

The brokerage expects India's cloud services market to grow at a 24.1 percent CAGR between FY26 and FY30, while the cloud GPU market is projected to expand at nearly 50 percent CAGR during the same period.

It also highlighted ESDS Software's $1.25 billion AI infrastructure contract with Sharon AI as a potential inflection point for the company's future growth.