Target: ₹3,245
CMP: ₹2,342.70
The Artificial Intelligence (AI) revolution, the most disruptive shift, could start a new cloud infrastructure era with a generational opportunity to build AI-cloud platforms, including infrastructure and integrated software, and drive a over $1.8 trillion market opportunity by 2030F/32F driven by a combination of demand and supply side factors. The non-discretionary nature of spending implies a durable investment cycle.
E2E Cloud has emerged as one of the top-tier cloud GPU infrastructure provider with a comprehensive line-up, a battle-tested software (TIR), and balance sheet (B/S) strength and parentage post equity infusion by Larsen & Toubro and is trusted by researchers, start-ups, and enterprises given price performance and scalability, predictable and affordable pricing, and open-source technology build. E2E, a springboard in the CPU era to launch many of the India-based unicorns, could be an appropriate vehicle to participate in this trifecta of opportunity.
Initiate coverage with an Add rating and a target price of ₹3,245 We model revenue/EBITDA CAGR of about 60 per cent over FY25-28F driven by monetization of capacity addition and accelerating adoption. Early mover advantage in an industry with structural & secular growth drivers provide growth visibility while deterioration in GPU pricing is a key downside risk.