The rapid expansion of artificial intelligence is fueling a massive buildout of data centre infrastructure in India, creating a multi-year investment cycle estimated to be worth ₹2.7 trillion. If data is the new oil, then data centres are the essential refineries, and India is fast becoming a global hub. The country generates nearly 20% of the world's data but hosts only 3% of global data centre capacity, a structural gap that global tech giants are now rushing to fill.
The Engine of Growth: From 0.3 GW to 8 GW
This boom is backed by staggering numbers. According to Colliers India, the nation's installed data-centre capacity has exploded from a mere 0.3 gigawatts (GW) in 2018 to 1.26 GW by April 2025. This surge is driven by a nearly 30-fold increase in data traffic since FY17, propelled by smartphones, OTT platforms, digital payments, and e-commerce. Analysts at Jefferies believe this is just the beginning, estimating capacity could quintuple to 8 GW over the next five years, attracting investments of around US$ 30 billion.
The commitment from hyperscalers is already in execution mode. Giants like Google ($15 billion), Amazon Web Services ($8.3 billion), OpenAI, Reliance ($11 billion), and Tata Consultancy Services ($6.5 billion) have pledged massive sums for AI-focused infrastructure. This buildout is creating a vast market for enablers across the value chain, including real estate ($6 billion), electrical and power systems ($10 billion), racks ($7 billion), cooling systems ($4 billion), and network infrastructure ($1 billion).
Five Stocks Poised to Capitalise
Here are five companies strategically positioned across this value chain to ride the data centre and AI wave.
E2E Networks: The Sovereign AI Hyperscaler
E2E Networks is a leading Indian Infrastructure-as-a-Service (IaaS) provider specializing in advanced Cloud GPU infrastructure, with a key focus on Sovereign AI. Its compute instances are spread across data centres in Noida, Chennai, and Mumbai, ensuring data locality. The company uses high-speed InfiniBand NDR technology to scale GPU clusters for massive AI training workloads.
Currently, E2E has access to about 10 megawatts of power capacity, which can support 8,000 to 10,000 cloud GPUs. As of late 2025, it had deployed nearly 3,900 GPUs, indicating significant room for growth. A strategic partnership with Larsen & Toubro has enabled capacity expansion at a state-of-the-art facility in Chennai. Financially, while Q2 FY26 saw a loss due to high depreciation from new GPU infrastructure, the outlook is bolstered by two major contracts worth ₹2,700 crore under the IndiaAI Mission.
Netweb Technologies: The High-End Computing OEM
Netweb Technologies operates as a leading original equipment manufacturer (OEM), designing and manufacturing the servers, storage, and software stacks that form the backbone of modern data centres. Its products are known for cyber-secure architecture and efficiency in managing critical workloads.
The company's AI segment is its primary growth engine, expanding by 160% to contribute 25.4% of revenue in H1 FY26. With a robust order book of ₹2,680 crore providing visibility for over two years, Netweb aims for a 35-40% CAGR over the next three years. It is also expanding internationally into Europe and the Middle East to capture global demand.
Cummins India: Powering the Data Centres
Cummins India is a major player in power generation solutions, a critical need for data centres requiring uninterrupted, mission-critical power. The company manufactures heavy engines and gensets locally due to logistical challenges.
In Q2 FY26, a striking 40% of its power generation sales came from data centres. Excluding this segment, the power generation business grew by only 20%, highlighting the outsized impact of data centre demand. Cummins serves both co-location players and hyperscalers like Microsoft, Amazon, and Google, and is also focusing on battery energy storage solutions for the future.
KRN Heat Exchanger: Cooling the Digital Heat
KRN Heat Exchanger specializes in manufacturing fin-and-tube heat exchangers crucial for cooling data centre infrastructure. As AI servers generate immense heat, efficient cooling systems become paramount.
The company expects the commercial HVAC segment, driven by data centres, to grow by at least 20% over the next decade. To meet this demand, it has increased its annual manufacturing capacity sixfold to 6 million units. KRN is eyeing major projects like Google's investment in Visakhapatnam, which alone could generate demand for ₹1,500 crore worth of heat exchangers.
Orient Technologies: The IT Infrastructure Enabler
Orient Technologies provides comprehensive IT infrastructure solutions for data centres, including network, backup, storage devices, and 24/7 monitoring services. It doesn't build the physical structure but equips the data centre to function.
The company is transitioning towards offering Total Outsourcing Services (ToS). A recent multi-year order worth ₹30.8 crore from New India Assurance to service its data centres underscores this capability. While current margins are under pressure from setup costs, they are expected to improve as higher-margin services scale up.
Execution is Key to Converting Tailwinds into Growth
India's AI data-centre expansion has moved from theme to reality, marked by committed capital and rising capacity. The opportunity extends beyond operators to a wide ecosystem of enablers. The five companies discussed are exposed to this structural, multi-year capex cycle at different points. However, investors must look beyond the hype. Sustained earnings growth will depend on execution, utilisation ramp-up, and balance-sheet discipline. A careful analysis of fundamentals, corporate governance, and growth strategy remains essential before any investment decision.
