Stock of this IT firm soars 55% in one month; up 141% from issue price

Netweb Technologies India hit a record high at Rs 1,206.50, and has rallied 10% on the BSE in Tuesday's intra-day trade.

Shares of Netweb Technologies India hit a record high of Rs 1,206.50, as they rallied 10 per cent on the BSE in Tuesday’s intra-day trade in an otherwise subdued market. In past two trading sessions the stock has surged 21 per cent, while in the last one month it has soared 55 per cent. In comparison, the S&P BSE Sensex was down 0.01 per cent at 69,918 at 10:58 AM.

Currently, Netweb quotes 141 per cent higher against its issue price of Rs 500 per share. The company made its stock market debut on July 27, 2023.

Netweb provides high-end computing solutions (HCS). It offers high-performance computing (supercomputing/HPC) systems; private cloud and hyper-converged infrastructure (HCI); AI systems and enterprise workstations; high-performance storage (HPS/enterprise storage system) solutions; data center servers, softwares and services.

Netweb caters to several marquee customers across various end-user industries such as information technology, information technology-enabled services, entertainment and media, banking, financial services and insurance (BFSI), national data centres and government entities including in the defence sector.

Since November 28, in past 11 trading days, the stock price of Netweb has surged 49 per cent after the announced partnership with American chip giant Nvidia to boost artificial intelligence (AI) infra in India and make high-end computing applications. It will be Nvidia's manufacturing partner for the NVIDIA Grace CPU Superchip and GH200 Grace Hopper Superchip MGX server designs.

Netweb will build and produce more than ten server variations under its Tyrone range of AI systems. In the announcement, the company said that Netweb's AI systems with MGX will give a boost to the country's "Make in India" mission.

At the same time, the local manufacturing of systems will build a local ecosystem to better address the demands around AI and accelerated computing applications of both government and private enterprises, the company said.

Meanwhile, Netweb’s management in their Q2 earning call said, the company’s business pipeline remains robust at Rs 3,148 crore with Rs 349.6 crore already qualified as L1 bids. Given typical conversion order cycle of six to nine months, the management anticipates receiving most of the orders related to these L1 bids in the second half of financial year 2024. On the back of strong pipeline and robust order book of Rs 217 crore, the management anticipates a much stronger second half.

Netweb has entered into License agreement with Intel to produce Next Gen Architecture based High end computing systems. The company plans to introduce ARM (Advanced RISC Machines) based servers, using RISC (Reduced Instruction Set Computer) architecture, optimized for newer AI workloads such as LLM.

The management believes this is a significant step forward as it will help the company to acquire big ticket cases where enterprises will comprehensively need the lowest footprint of the data center high-end servers and multiply the performance of system with more cores per power per watt.