Google's hundred billion dollar investment in India, the AI investment around "data centers" is flooding the Indian stock market.

With US tech giants Alphabet's Google, veteran tech leader Microsoft, and OpenAI and other US AI leaders promising to invest over 100 billion dollars in building artificial intelligence infrastructure on a large scale in India, investors are eagerly seeking local Indian companies that will benefit from this unprecedented wave of AI investment. They are collectively turning their focus to Indian companies associated with data center construction, which will benefit from the comprehensive establishment of India's local artificial intelligence ecosystem. The construction of artificial intelligence supporting large-scale infrastructure is expected to drive the development process of local data center support companies, including core power equipment manufacturers and some large power generation companies. By 2027, the investment scale of the Indian data center market is expected to exceed 100 billion dollars. Recent data shows that a custom index tracking the stock of 10 data center support companies has risen by over 30% since April, with potential beneficiaries including data center operators, electrical and power equipment manufacturers, and liquid cooling solution providers. The creation of the AI ecosystem is providing investors with new major investment opportunities in India's stock market, which is valued at $5.4 trillion. The reason behind India's market lagging behind the global stock market rebound process this year is the lack of pure AI computing hardware targets like US chip giants NVIDIA, Broadcom, Micron Technology, and AMD, as well as super cloud computing giants that directly benefit from the surge in cloud services and cloud-based AI computing like Google, Microsoft, and Amazon. In the Indian stock market, investors are turning to local data center support companies from power equipment manufacturers to power generation companies which are expected to significantly benefit from the construction of supporting infrastructure for AI data centers. This is one of the hottest equity trades globally. Just in the Indian data center market, CBRE Group Inc. anticipates investment scale to exceed $100 billion by 2027. "India is powering its AI era by running the core infrastructure needed for AI - including server clusters and energy capacity to power data centers," said Shambhavi Gupta, founder of the global macro insight platform Nine Spot Seven. "Unlike the tech stock market in the US, the current stock market AI investment frenzy in India is based on tangible assets." A custom index tracking the stocks of 10 such supporting companies has risen by over 30% since hitting a low point earlier this year following the global market turmoil caused by the Trump tariff impact. This is almost double the increase of the Indian stock market benchmark NSE Nifty 50 index during the same period. US tech giants are driving this momentum. Google outlined last month its partnership with some local Indian companies to build an AI infrastructure hub in southern India, with initial plans to invest around $15 billion. In September, media reports stated that OpenAI, the developer of ChatGPT, is also seeking to build a large AI data center in India. Earlier this year, Microsoft announced plans to invest around $3 billion in India to expand its cloud computing and AI computing infrastructure. Amazon has already planned to invest approximately $12.7 billion by 2030 to build one of India's largest AI data centers. Here are some potential beneficiaries of this investment frenzy in Indian data centers and their stock performance over the past three months: Data center operators and partners AdaniConneX Pvt. - a joint venture between Gautam Adani's flagship Adani Enterprises Ltd. (+2.1% in the past three months) and India's second largest wireless operator Bharti Airtel Ltd. (+7.3%) - is collaborating with Google on its large AI project in the port city of Visakhapatnam. Billionaire Mukesh Ambani's Reliance Industries Ltd. (+6.9%) is also expected to invest up to $15 billion for a one-gigawatt AI data center. According to Jefferies Financial Group Inc. data, these three companies combined could account for 35%-40% of India's data center capacity by 2030. India's largest software service export company Tata Consultancy Services Ltd. (+0.7%) also plans to build a one-gigawatt large AI data center, while OpenAI is looking for local partners to land its data center in India. Meanwhile, one of India's data center pioneers, Sify Infinit Spaces Ltd., submitted a Rs 37 billion (approximately $417 million) initial public offering application last month. India's first AI unicorn Fractal Analytics, which provides related products and services, also submitted an IPO application in August. Electrical and core power equipment A significant portion of capital expenditure around AI data centers is expected to flow into electrical and core power equipment, including manufacturers of core switchgear, transformers, and distribution systems. Notable Indian stocks include: Hitachi Energy India Ltd. (-12%), which provides end-to-end electrical equipment for data centers; Siemens Ltd. (+2.1%), Schneider Electric Infrastructure Ltd. (-17%), and ABB India Ltd. (-5.3%), providing distribution systems and industrial equipment. "Data center investments will be a significant stimulus and boost for the Indian power industry," said Ashish Gupta, Chief Investment Officer of Axis Mutual Fund, which manages around $40 billion in assets. He emphasized that power and related costs will account for approximately 40% of data center capital expenditures. Liquid cooling solutions The high energy consumption of AI workloads at the scale of terabytes will generate a large amount of heat, especially during the hot summer in India, requiring today's most professional liquid cooling systems. Blue Star Ltd. (+11%) and Voltas Ltd. (+4.2%) are undoubtedly among the largest Indian companies providing advanced liquid cooling solutions suitable for data centers. Servers and cloud infrastructure In addition to power infrastructure and cooling systems, large-scale AI data centers landing in India will require increasingly massive physical computing backbone. Netweb Technologies India Ltd. (+99%) is considered a key player in servers, storage, backup, and AI supercomputing solutions. E2E Networks Ltd. (+49%) is focused on providing cloud hosting services for AI computing hardware and high-performance computing.