India's data centre sector has over $6.5 billion in investments committed through private equity, joint ventures and acquisitions between 2014 and 2024, a new report by Anarock Capital shows.
The industry has witnessed exponential growth between 2019 and 2024, recording a 139% increase in capacity — scaling from 590 MW in 2019 to 1.4 GW in 2024.
Market Concentration, City-Wise Distributio,
Mumbai and Chennai dominate the data centre market, accounting for 70% of India's total IT power capacity, with Mumbai alone contributing nearly half at 49%. These cities also witnessed phenomenal supply growth from 2022 to 2024 — 92% in Mumbai and 340% in Chennai.
Other key markets include: Noida: 9%; Bengaluru: 8%; Hyderabad: 4%; Pune: 5%.
Investments, Land-Acquisition Trends
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: Hyderabad: 69%; Mumbai: 22%; Pune: 9%.
Financial, Deployment Trends
The size of the data centre sector is estimated at $10 billion, with $1.2 billion in revenue for FY24, according to Shobhit Agarwal, chief executive officer of Anarock Capital.
"Capital deployment has surged between 2022 and 2024, with $4.2 billion deployed on-ground till FY 2024," Agarwal added. "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."
Key Trends For 2025, Beyond
AI-Driven Demand
Artificial Intelligence is set to drive the next wave of DC requirements. To accommodate AI workloads, future-ready DCs will require: liquid cooling technologies, rack densities of more than 30–40 kW per rack, and floor loads up to 2,500 kg/sq.m.
Rise Of Edge Data Centres In Tier II Cities
To bring computing closer to users, edge data centres, which are small-scale, decentralised data storage and processing facilities located closer to end-users and devices in tier 2 and tier 3 markets, are emerging.
These include cities like Jaipur, Ahmedabad, Kochi, Vizag, Lucknow, Patna, and Bhubaneswar. Essential for real-time apps and generative AI services, these facilities handle data locally, thereby lowering latency.
Green Data Centres
With environmental concerns gaining traction, there is a growing emphasis on energy-efficient design, renewable energy sourcing and sustainable cooling methods. Green data centres are set to be a cornerstone of industry development.
With exponential growth in data consumption, aggressive capital infusion, hyperscaler activity and a strong push towards AI and sustainability, India is set to take a pole position in terms of global data infrastructure, the report added.
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