ESDS Software Solution Limited has filed its Draft Red Herring Prospectus (DRHP) with SEBI for a ₹576.00 Crore fresh issue. The Nashik-based AI-enabled cloud and data centre provider aims to raise capital to expand its infrastructure capacity in a high-growth GPUaaS market.

Company Overview

ESDS Software Solution Limited is an AI-enabled technology company providing Infrastructure as a Service (IaaS), Managed Services, Software as a Service (SaaS), and GPU-as-a-Service (GPUaaS). Headquartered in Nashik, Maharashtra, it is one of only two players in India offering the full spectrum of GPUaaS, cloud, managed services, data centre infrastructure, and software solutions. It is the largest among the two by revenue from operations in Fiscal 2026.

The company operates six Tier-3 compliant Data Centres at Airoli, Bengaluru, Mohali, and Nashik, three of which are operated in collaboration with STPI. It holds patents for SWARAJ vertical auto scalable cloud technology in both the US and India.

Offer Details

• Issue Type: Initial Public Offering (IPO)
• Fresh Issue Size: ₹576.00 Crores
• Offer for Sale (OFS): Not Available (NA)
• Price Band: Not Available (NA)
• IPO Open Date: 28-Aug-2026
• IPO Close Date: 01-Sep-2026

Objects of the Issue

• Purchase and Installation of Cloud Computing Equipment: ₹576.00 Crores allocated for purchasing servers, storage, and networking equipment at Airoli, Bengaluru, Mohali, and Nashik Data Centres.
• General Corporate Purposes: Balance of Net Proceeds for strategic initiatives, working capital, and repayment of borrowings.

Financial Highlights

The company has demonstrated strong growth in revenue and profitability over the last three years.

Revenue from operations grew at a ~30.60% CAGR over two years, while Net Profit surged by ~197.84% over the same period. Profit Before Tax margin expanded sharply from 7.78% in FY2024 to 35.44% in FY2026.

Risk Factors

• Technological Obsolescence: Rapid innovation may render current cloud infrastructure obsolete, requiring expensive upgrades.
• Customer Concentration: In Fiscal 2026, the top client represented 15.93% of revenue, and the top 10 clients represented 45.36%.
• Government Dependency: Government entities contributed 27.37% of revenue from operations in FY2026; policy changes could impact business.
• Cybersecurity Risks: Storage of personally identifiable information (PII) exposes the company to potential data breaches and litigation under the Digital Personal Data Protection Act, 2023.
• Asset Hypothecation: As at March 31, 2026, 96.72% of total current assets were hypothecated as security for borrowings.

Valuation & Peer Comparison

Specific peer comparison data is Not Available (NA). ESDS operates in a niche segment with limited direct listed peers. The cloud GPU market is projected to grow from USD 67.31 million to USD 513.67 million by Fiscal 2030 at a 50.15% CAGR. The fresh issue size of ₹576.00 Crores is approximately 4.76x the FY2026 PAT of ₹120.82 Crores.

Bottom Line

ESDS Software Solution presents a strong growth story with expanding margins and a unique position in the Indian GPUaaS market. Investors should note the high customer concentration and unusual cash flow figures in FY2026 before applying.