ESDS Software Solution shares hit 20% upper circuit for 2nd straight session, this brokerage sees 71%…

September 7, 2026

The latest market report highlights that ESDS Software Solutions shares hit the 20 percent upper circuit limit for the second straight session on Monday, following a firm debut on the bourses on September 4.

Shares of the firm settled at Rs 1,090.05 per share on the NSE, up 20 percent, hitting the highest permissible trading limit for the session.

In the meantime, market watchers at Choice Institutional Equities see nearly 71 percent upside in the stock, with a target price of Rs 1,550 per share.

The brokerage has initiated coverage on ESDS with a 'BUY' rating and a target price of Rs 1,550, valuing the firm at 18 times FY28E EV/EBITDA, with a DCF used as a sanity check.

Choice Institutional Equities stated ESDS offers an opportunity to gain exposure to India's cloud, data-centre and AI infrastructure build-out, supported by its capabilities across cloud, managed infrastructure and data-centre services.

It stated expansion is anticipated to be supported by capacity expansion, deeper customer monetisation and operating leverage, with the USD 1.25 billion AI contract adding a new leg to the firm's earnings trajectory.

The brokerage anticipates topline, EBITDA and PAT to grow at CAGRs of 120.9 percent, 72.6 percent and 81.3 percent, respectively, over FY26-29E, fuelled by core business momentum and the ramp-up of AI infrastructure revenues.

It stated its 18 times FY28E EV/EBITDA valuation implies around 31 times FY28E forward P/E and that successful execution and a faster ramp-up of the AI contract could provide further upside to earnings and valuation.

ESDS Software Solutions made a firm debut on the bourses on Friday, stock-exchange debut at a premium of more than 76 percent over its offering price of Rs 429 before surging further to hit the upper circuit limits.

The stock listed at Rs 757 on the NSE, a premium of 76.46 percent over the offering price.

On the BSE, the stock listed at Rs 746.30 per share, a premium of 73.96 percent.