India’s data centre industry has seen over $6.5 billion in investments committed through private equity, joint ventures, and acquisitions between 2014 and 2024, according to a report by ANARAOCK Capital.
The report, titled as “India Data Centre Market: Growth, Trends & Outlook”, observed that India’s data centre is currently estimated worth $10 billion and around $1.2 billion revenue has been generated in FY2023-2024. The data centre sector has witnessed exponential growth between 2019 and 2024, recording a 139 percent increase in capacity - scaling from 590 MW in 2019 to 1.4 GW in 2024, the report said.
The report observed that 78 percent of the revenue is generated by four major data centre operators. While EBITDA growth showed signs of plateauing post-2020, it is projected to rise by 50-55 percent as under-construction projects reach stabilization, it said.
"Capital deployment has surged between 2022 and 2024, with $4.2 billion deployed on-ground till FY 2024. The total capital deployed, including fixed assets and working capital, amounted to $2.6 billion in equity and $2.4 billion in debt as of March 2024. This signals aggressive expansion sentiment and investor confidence," Shobhit Agarwal, MD & CEO – ANAROCK Capital, said.
Devi Shankar, Executive Director - Industrial, Logistics & Data Centres, ANAROCK Capital, said this surge is underpinned by rising internet penetration, which has risen from 33.4 percent in 2019 to 55.2 percent in 2024, a near-doubling in data consumption per user from 11.5 GB to 21.1 GB per month, and an explosion in average traffic per smartphone, which grew from 13 GB to 32 GB.
“India now leads globally in average mobile data traffic per smartphone, and just this fact alone has had a palpable impact on the demand for high-grade data centres in the country. India's booming digital engagement is a direct indicator of future data centre demand," she said.
Market concentration and city-wise distribution
Mumbai and Chennai dominate the data centre market, accounting for 70 percent of India’s total IT power capacity, with Mumbai alone contributing nearly half at 49 percent. These cities also witnessed “record-breaking” supply growth from 2022 to 2024—92 percent in Mumbai and 340 percent in Chennai.
The other key data centre markets in India include Noida (9 percent), Bengaluru (8 percent), Hyderabad (4 percent) and Pune (5 percent). Together, these regions have contributed to an overall occupancy level of 76 percent, underscoring strong market absorption and operational efficiency.
The report also observed that India has emerged as a hotspot for hyperscalers adopting the 'own-and-operate' model. Over the past five years, around 440 acres of land have been acquired for the creation of hyperscalers across three major cities which include Hyderabad (69 percent), Mumbai (22 percent) and Pune (9 percent).
Hyperscalers are large-scale data centers and cloud service providers that offer massive computing resources, storage, and networking infrastructure.
To bring computing closer to users, edge data centres, which are small-scale and decentralized data storage and processing facilities, are emerging in tier II and tier III markets. Some of these cities include Jaipur, Ahmedabad, Kochi, Vizag, Lucknow, Patna, and Bhubaneshwar among others, the report said.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
