Five AI infrastructure stocks riding the data centre boom | Stock Market News

It always starts with the chip. Nvidia designs it. Taiwan makes it. Indian investors watch from the outside, with no clear way in.

But a chip on its own does nothing. It has to sit inside a server. That server needs a building. The building needs power - lots of it - and a fibre line quick enough to shift the data. Strip away the glamour, and what is left is a huge construction job. Steel, cable, transformers, and cooling.

That job – the physical body of artificial intelligence (AI) – is now underway in India. The country ran about 1,500 megawatts (MW) of data centre capacity at the start of 2025.

It should cross 2,000 MW by the end of 2026, and the government expects the cloud part alone to grow four to five times by 2030. This year's budget even dangled a tax holiday out to 2047 for foreign cloud firms that build here.

Someone has to pour the concrete, string the fibre, and wire the grid. Here are five listed AI Infra companies doing exactly that - one for each layer of the machine.

Netweb builds servers. Not ordinary ones, but the high-powered machines that run AI.

It is one of a handful of Indian firms that assembles these systems at home, and an official partner of both Nvidia and AMD. When a government lab or a big company wants an AI cluster built in India rather than shipped in, Netweb makes the shortlist.

The company’s growth has been steep. In the quarter ended June 2026, revenue jumped to ₹8.2 billion (bn), from ₹3 bn a year earlier - a rise of 172%.

Net profit climbed 180% to ₹850 million (m), or ₹85 crore. The AI part of the business did the heavy lifting. Sales there grew nearly six times and now make up close to two-thirds of the total.

The order book stood at ₹25 bn in June, and Netweb has already won work under the government's IndiaAI Mission. The one catch is the price. The stock leaves no room for error, at more than 100 times earnings. A single soft quarter could sting investors.

Next comes the company that rents the compute out.

Not everyone wants to buy servers. Many just want to rent time on them by the hour. That is the cloud, and E2E Networks is India's first listed pure-play in it - the local way to rent a graphics processing unit (GPU) without owning one.

For years, E2E was small and loss-making. Then the AI wave hit. In the June 2026 quarter, revenue rose more than four times to ₹1.57 bn from ₹361 m a year earlier, and the company swung from a loss to a profit of ₹439 m. The rent it collects each month nearly doubled in just three months.

The engine is a fresh cluster of 1,024 Nvidia B200 chips, the newest kind, running close to full. E2E now runs about 5,100 GPUs and split its stock ten-for-one in June to widen ownership. The risk sits right in the story. Chips are dear and age fast, so E2E must keep spending to stay current.

And after a run like this, the shares trade at eye-watering multiples.

Servers and clouds need somewhere to live - a hardened building with backup power, cooling, and security. Anant Raj, once known only as a Delhi property developer, has quietly become one of them.

It now runs 28 MW of data center capacity across Manesar and Panchkula in the north. That may not sound like much, but the plan is bold. The company is aiming for 63 MW by December 2026 and 117 MW by 2028. It has signed a deal with Haryana to invest as much as ₹250 bn over time and set up a Singapore arm to chase cloud and AI work abroad.

The money is already real. In the first half of the last financial year, the data center business earned about ₹584 m and threw off most of the group's operating profit.

Anant Raj now plans to hive it off into a separately listed company, so investors can own the digital business on its own. The worry is funding. Data centers eat cash, and the company must spend heavily while keeping debt in check.

Then the wire that ties the machines together.

Inside a modern AI data center, a web of optical fibre lashes the servers together. GPU racks pack in so tightly that they need far more fibre than the old computer halls - by one estimate, dozens of times more. Sterlite Technologies makes that fibre and the cable around it.

The turn in its fortunes has been sharp. In the June 2026 quarter, revenue rose 87% to ₹19.1 bn, and profit hit a record ₹1.97 bn. After years of heavy debt, the company now sits on net cash.

The real prize is the order book. It stood at ₹186 bn in June - more than double the figure three months earlier. One contract explains most of it: a $1.11 bn deal, worth more than ₹100 bn, to supply optical connectivity for next-generation AI data centers between now and 2029.

Fibre is still a cyclical, price-sensitive trade, and Sterlite has burned investors before. But for the first time in years, the order book and the balance sheet point the same way. Up.

Last, the power that runs the whole thing.

An AI data center is, above all, a giant electricity customer. One large campus can pull as much power as a small town. Someone has to build the grid links, the transformers, and the switchgear that carry that load. In India, Hitachi Energy is the biggest name doing it.

This is the sturdiest business of the five. Hitachi Energy sells to power utilities, railways, and industry - and now, more and more, to data centers.

In the June 2026 quarter its order backlog reached a record ₹322 bn, and management said data centers were among the largest sources of fresh orders. One of them was a single power project for a data center in Hyderabad.

The company is spending to keep up, building its twentieth factory in India to meet the demand. The drawback is the entry price. Hitachi Energy is a quality business, and the market knows it. The stock trades at nearly 150 times earnings - a steep toll to ride this particular train.

There is an old line about gold rushes: the real money went to the people selling shovels, not the miners swinging them. The biggest shovel-seller today is Nvidia, with AMD close behind, and the buyers are the American cloud giants pouring hundreds of billions of dollars into data centers.

The five names here sell shovels to those buyers - one more step down the chain. That leaves three honest questions, and none of them has a clean answer.

The first is debt, because borrowing, not slow growth, is what usually kills a company when a boom turns. The comfort is that most of these five are not betting the balance sheet - Sterlite has swung to net cash, Netweb and Hitachi Energy carry little debt, and both Anant Raj and E2E have leaned on fresh equity rather than loans to fund the build.

The second is valuation. Four of the five price in years of fast growth, and a rich multiple only holds while the growth keeps arriving.

The third is how long that growth lasts. A capex wave this steep has never moved in a straight line, and the day it slows, how far these stocks fall is something nobody can map in advance.

They are the questions worth sitting with before the story carries you along.

Five companies, five layers of the same machine. The server, the cloud, the building, the fibre, and the power. Put them together, and you get the physical body of India's AI push.

None of this is a green light. Those three questions - debt, valuation, and how long the growth lasts - do not have tidy answers, and this piece will not pretend to hand you one.

Order books and targets are promises, not profits, and a boom that arrives slower than hoped would test every name here.

But the direction is hard to argue with.

India is wiring itself for AI, at speed. Unlike the chip itself, this layer of the build trades in plain sight, on an Indian exchange. The concrete is going down right now.

The question for an investor is not whether the boom is real. It’s how much you are willing to pay to stand next to it.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.

This article is syndicated from Equitymaster.com

Equitymaster is India's leading independent equity research platform, providing in-depth research and analysis on BSE- and NSE-listed companies since 1996. As a SEBI-registered Research Analyst [Registration No. INH000021128], Equitymaster covers the full spectrum of Indian equities — bluechip stocks, midcap stocks, smallcap stocks, and microcap stocks.<br><br> At the heart of Equitymaster's research philosophy are the principles of value investing — particularly the margin of safety and the primacy of investment over speculation. All research is produced by an independent team of SEBI-registered research analysts with vast experience in Indian financial markets, using detailed systems and processes developed entirely in-house.<br><br> With over 17 lakh readers across 72 countries, Equitymaster is one of India's leading equity research publications. Since 1996, the goal has remained the same — to deliver honest, unbiased, and credible equity research that helps Indian investors make better, more informed decisions.

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