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The strong domestic mutual fund participation in ESDS Software’s anchor book suggests a high level of confidence from local institutional investors in the company’s growth prospects within the cloud and data centre sector. The limited presence of foreign investors and the allocation to smaller AIFs might be seen as factors requiring further scrutiny by potential investors as the IPO subscription opens. The company’s financial performance shows a significant upward trend, particularly in net income, which could be attractive to investors. However, direct peer valuation comparison is noted as difficult due to the negative EPS of its sole listed comparable, E2E Networks, suggesting a premium valuation for ESDS Software at its IPO price band.
ESDS Software, a Nashik-based provider of AI-enabled cloud and data centre solutions, successfully raised INR 216 crore from 19 anchor investors on August 27, 2026, at an issue price of INR 429 per share, the upper end of its price band. The company’s three-day initial public offering (IPO) subscription window is set to open on August 28, 2026.
The anchor book was predominantly subscribed by domestic mutual funds, which claimed more than four-fifths of the total allocation. Six domestic fund houses participated through 13 distinct schemes, securing 41,25,832 shares, representing 81.94% of the anchor allotment. This indicates a strong appetite from India’s retail-facing fund industry for the cloud and data centre sector. The remaining allocations were distributed among two general insurance entities, two Category-III Alternative Investment Funds (AIFs), and other non-mutual fund investors, with limited participation from Foreign Portfolio Investors (FPIs).
Motilal Oswal Mutual Fund emerged as the single largest recipient among fund houses, acquiring 11,18,872 shares across two schemes, accounting for 22.22% of the anchor book. Bandhan Mutual Fund followed with an equal allocation of 11,18,872 shares spread across two schemes, also representing 22.22% of the anchor book. Quant Mutual Fund also secured the same aggregate share of 11,18,872 through its two QSIF schemes. ITI Mutual Fund participated with a combined 3,66,174 shares across five schemes (7.27%), while JM Financial Mutual Fund and Samco Small Cap Fund received 1,86,490 and 1,16,552 shares respectively.
Among non-mutual fund investors, Bajaj General Insurance received allocations through both its policyholder and shareholder funds, totalling 3.70% of the anchor book. Other notable non-MF allottees included Meru Investment Fund PCC Cell 1 (4.63%), Sanshi Fund-I (4.63%), Cognizant Capital (2.78%), and CP Capital (2.32%).
The concentration of demand from domestic mutual funds, including substantial commitments from major players, signals broad interest in ESDS Software’s business model. However, the absence of foreign institutional investors and the presence of several smaller AIFs in the latter part of the book are points institutional observers are likely to consider. ESDS Software, which operates five Tier-3 data centres across India, saw its revenue grow from INR 286.52 crore in FY2024 to INR 472.21 crore in FY2026, with net income sharply expanding to INR 120.82 crore in FY2026 from INR 13.61 crore in FY2024.
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