India Emerges as Top Destination for Data Center Business, Report Shows

New Delhi [India], March 29 (ANI): India has the potential to become a favored data centre Due to hosting several enabling factors, such as enhanced cross-border connectivity (with an increasing number of submarine cables being landed) and lower capital and operational costs (including reduced expenses for utilities and labor), JM Financial stated in their report.

The financial advisory company additionally claimed that India’s advantageous position between the Middle East and Southeast Asia provides the nation with a competitive advantage in this sector.

The report released by JM Financial this week stated that the demand for data centers in India is undoubtedly increasing.

"The factors driving this upward trend include both long-term structural elements and short-term cyclical ones. The substantial number of internet users producing vast amounts of data, along with the government’s initiative for data localization and advancements in artificial intelligence, represent key structural drivers,” according to the JM Financial report.

Even though India's data centre The business is expanding, yet it holds a significantly smaller percentage of the market than expected. data centre s.

JM Financial noted that despite India generating 20 percent of global data, it accounts for just 5.5 percent of worldwide data share. data centre capability – and a less-rapid-than-anticipated capability expansion.

According to the report, these factors have exacerbated the demand-supply imbalance, leading to a cyclic upsurge in capacity expansion.

India's co-location data centre The capacity in 2024 is 1.35 gigawatts, representing a 38 percent increase from the previous year. Nonetheless, India's data centre It has one of the lowest densities globally.

The report stated, "We project that India requires an overall capacity of 5 GW by 2030 merely to achieve half of China's DC density."

This matches the currently declared upcoming construction and scheduled capacity of 3.3 gigawatts by 2028.

The report predicts substantial capital expenditure in data centre As we look forward in the coming years.

Although most of the spending on cloud infrastructure will come from hyperscalers, we believe that their capital expenditures will continue to increase. data centre "Capacity worth USD 20 billion could lead to equity issuance of around USD 10 billion," it stated.

Nevertheless, these will only cater to India's local needs, it observed. Considering the potential in this growing sector, JM Financial expects more firms to go public through stock market listings within the next five years.

Considering the high capital requirements of this sector, we expect numerous local players to go public to secure additional funds. The early investment prospects may focus primarily on the upstream portion of the value chain… Investors should prepare for a busy period.

A data centre It is a physical space utilized by organizations to accommodate essential applications and information.

A data centre Its architecture relies on a framework of computational and storage facilities that facilitate the provision of communal software programs and information. The principal elements of such a system include: data centre Design encompasses routers, switches, firewalls, storage systems, and servers, amongst other components. (ANI)