The shares of a Smallcap IT company, which is an AI-focused hyper scale cloud platform, offering advanced cloud GPUs and a comprehensive ecosystem of cloud technologies designed for the development and deployment of AI/ML applications that generated a multibagger return of 1400 percent in the past five years, are worth adding to your watchlist.
Price Action
The shares of E2E Networks Ltd, with a total market capitalization of Rs 3,946.85 Crore on Thursday, were trading at Rs 1,977 per share, which was 1.4 percent lower than the previous closing price of Rs 2,005 apiece.
The shares of E2E Networks Ltd have generated a multibagger return of 120 percent in the last one year and a stellar return of 1304 percent in the past five years. The shares have corrected around 61 percent from its 52-week high of Rs 5487.65 per share.
Industry Overview
According to the BCG-Nasscom report, the Global AI market is projected to grow at a CAGR of 25 to 30 percent from $130 billion to $380 billion over the forecast period of 2023 to 2027. Additionally, the Global AI Market is projected to become a Trillion-Dollar Size by 2032.
Financials
The company reported an increase of 74 percent YoY in revenue from operations from Rs 24 crore in Q3FY24 to Rs 42 crore in Q3FY25. Their Net Profit jumped by 108 percent YoY from Rs 6 crore to Rs 12 crore over the same period. On the Operating front, its EBITDA grew by 119 percent from Rs 112 crore to Rs 246 crore.
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Client Base
Notable clients include Zomato, Cars24, MobiKwik, Nykaa, Indiamart, Healthkart, etc, which have utilized E2E’s infrastructure to scale their operations significantly during their growth phases.
Future Outlook
The company plans to expand data center capacity from 4.2 megawatts to nearly 10.2 megawatts, supported by recent fundraising. The company is focused on the continuous development of its AI/ML platform called TIR for data scientists and developers to streamline AI/ML workloads. The management is confident that the company is well-positioned to fill the demand-supply gap in India’s AI market, especially in generative AI, with a commitment to driving digital transformation.
Strategic Partnership with L&T
The company has successfully raised over Rs 1,000 crores from L&T for expanding accelerated cloud infrastructure focusing on next-generation cloud GPUs and GPU clusters. L&T has acquired a 15 percent stake in the company through preferential allotment in December 2024 and will further acquire a 6 percent stake in May 2025.
The company, through its strategic partnership with L&T, is focused on revolutionizing AI and cloud infrastructure in India. The company anticipates improvements in operational efficiency, profitability, and revenue through leveraging each other’s strengths.
Competitive Market
The management emphasised the increased competition in the AI and cloud infrastructure space, particularly from global players like AWS and Google Cloud, and expects a lot more new players to enter the market as it expands.
About E2E Networks Ltd
E2E Networks Ltd is a prominent cloud service provider in India, established in 2009. It specializes in providing advanced cloud infrastructure and managed services, focusing on high-performance computing solutions, particularly in the fields of artificial intelligence (AI) and machine learning (ML). The company has positioned itself as a leader in the Indian cloud market by catering to startups and established businesses alike.
Written By Adhvaitha Nayani
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