According to a report by CRISIL, the revenue of India’s data centre (DC) operators will climb to Rs 200 billion annually by fiscal 2028 (FY28), reflecting a strong annual growth rate of 20-22 per cent as both enterprises and retail users increase their adoption of digital platforms and technologies.
The Capacity addition in the sector is also expected to accelerate, with overall capacity likely to double to 2.3-2.5 GW by March 2028. The operators that collectively account for 75-80 per cent of India’s active DC capacity have shared similar projections.
The expansion of the DC industry will be supported by three key drivers: the rapid shift of enterprises to public cloud amid ongoing digital transformation, rising investments in artificial intelligence (AI), and the growing adoption of 5G networks. These trends are pushing demand for low-latency services such as video streaming, gaming, and internet of things (IoT)-based applications necessitating data centre infrastructure closer to end-users.
Additionally, the incremental 1.1-1.3 GW capacity expected to be commissioned between FY26 and FY28 is likely to secure timely customer tie-ups, driven by solid demand and India’s low data centre density of 65 MW per exabyte, one of the lowest globally. This favourable demand environment offers ample room for supply to expand.
Further, the report notes that the credit profiles of DC companies are supported by strong customer stickiness due to high switching costs and long-term contracts, particularly with hyperscalers. The share of hyperscalers in the overall revenue mix has been rising steadily. They now contribute to more than half of all capacity commitments, offering stable and predictable cash flow visibility for operators.
