ESDS Software Solutions Limited comprises a fresh issue of Rs 322 crore and an offer for sale of 2,15,25,000 equity shares by existing shareholders and promoters.
ESDS Software has built a comprehensive cloud platform that manages cloud service and end-to-end cloud requirement. Their cloud platform consists of a well-architected cloud infrastructure that reduces the cost and provides safety to your customers. Due to the diverse portfolio of ESDS Software Solutions, they have positioned themselves as a “one-stop-shop” for their customer’s cloud adoption.
Their comprehensive IaaS cloud computing services portfolio includes public cloud, private cloud, virtual private cloud, hybrid cloud and various community cloud offerings.
ESDS Software Solutions IPO Objectives:
- The fund will be utilised to purchase cloud computing equipment for our data center
- A part of the fund will be used for general corporate purposes (such as: working capital, brand building exercises, expenses incurred in the ordinary course of business, etc), s approved by the Board, from time to time.
Why should you invest in ESDS Software Solutions:
- Due to IT adoption led by cloud computing by the firms, there has been a huge transformation of backend operations resulting in an intensified value proposition for the customers. With the advancement of cloud services, a lot of small companies got access to technological capabilities which was prior available to large enterprises only.
- Due to the impact of Covid 19 in 2020, the cloud service got accelerated. During the first quarter of 2020, the use of cloud computing increased by 35%, compared to the fourth quarter of 2019. The shift to work-from-home led the firms to choose cure, reliable, scalable, and cost-effective technology services across the country.
Competitive Analysis Market Peers:
There was no competitor analysis for ESDS Software Solutions
IPO Financials
| Metrics | FY2021 | FY2020 |
|---|---|---|
| Total Income (in millions) | 1,741.01 | 1,605.34 |
| EBITDA | 638.05 | 517.23 |
| EBITDA Margin (%) | 36.65 | 32.22 |
| Revenue from long-term contracts (as a % of the total revenue for that respective year) | 92.88 | 84.38 |
| Revenue from existing customers (as a % of the total revenue for that respective year) | 88.53 | 74.53 |
| New customers added during the period (nos) | 406 | 318 |
| Revenue from top 20 customers (as a % of the total revenue for that respective year) | 50.90 | 53.63 |
| Average revenue per customer (in million) | 24.39 | 23.40 |
| Revenue from IaaS (as a % of the total revenue for that respective year | 51.15 | 52.99 |
| Revenue from SaaS & Managed Services (as a % of the total revenue for that respective year) | 48.85 | 47.01 |
Know before investing
Strengths
3The brand’s one-stop-shop for cloud adoption helps them in customer acquisition and retention and set them apart from other competitors.
ESDS Software Solutions has introduced several billing solutions to add value to their customers.
The brand is one of India’s leading managed cloud service and end-to-end multi-cloud requirements providers.
Risks
3As the firm is involved cloud computing infrastructure services, any inability of the company to prevent service disruptions could adversely impact business.
Any online security breach can harm the reputation of the brand resulting in a financial impact.
The brand’s growth depends on its ability to maintain a successful relationship with our technology and business collaboration Partners. Any deterioration in the relationship may affect the business severely.
