According to a report by CRISIL, the Indian data centre industry is expected to boom with an annual growth rate of 25-30 per cent to reach $4.5-5 billion by fiscal 2025.

Further, the study pointed out that the Covid-19 pandemic has been one of the key drivers for the growth. As per CRISIL estimates, the data consumption increased by 38 per cent on a year on year basis in the first quarter of the current fiscal year. And this growth in data was driven by Covid-19.

The report noted that the data centre expansion will be supported by growth in data volumes to support high growth in e-commerce, increase in usage of social media, greater preference for over the top (OTT) platforms, the government’s impetus to the Digital India initiative and rapid digitalisation of services across industries.

Geographically speaking, the data centre industry has been largely concentrated in top four cities, with Mumbai, Delhi, Bengaluru and Chennai accounting for 60 per cent of total sites.

As far as the market dynamics in the data centre industry is concerned, the top 11 players account for more than 70 per cent of the total revenue. This is because the initial capex required to set up infrastructure is significantly high and the payback period is long.