Netweb is a leading provider of high-end computing solutions in India, offering a wide range of services including High-Performance Computing (HPC), private cloud and Hyperconverged Infrastructure (HCI), Artificial Intelligence (AI) systems, data centres, and software and services. The company is experiencing significant growth in its HPC, private cloud, and AI systems segments, with a projected Compound Annual Growth Rate (CAGR) of 77% from FY22 to FY25.
The Indian government's initiatives, such as IndiaAI and the National Supercomputing Mission, are driving demand for high-end computing solutions. Netweb's Unique Selling Points (USPs) include being India's only full-stack hardware provider, its strong partnerships with Original Equipment Manufacturers (OEMs) like NVIDIA, AMD, and Intel, and its robust client base with support from government programmes.
We project a revenue/PAT CAGR of 59%/58% from FY25 to FY28E and assign a target multiple of 56x on Dec'27E-ending EPS of INR 73. Our target price stands at INR 4,110, factoring in an INR 21.8bn order from the IndiaAI Mission and a revenue CAGR of ~38% from FY26 to FY28E. We recommend a BUY rating for Netweb.
Please note that investment decisions should be made after consulting certified experts.
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