Top 5 Fastest Growing Data Center Stocks to Add to Your Watchlist

India's data center market is experiencing rapid growth, driven by increasing digitalisation, cloud adoption, and government initiatives.

With global attention focused on the country, India has emerged as one of the fastest-growing data center markets worldwide.

Thie growth has been possible due to the growth that Indian data center companies have shown, over the past one year.

The growth is further supported by the Indian government and several states as they are providing incentives for data center investments, including tax benefits, land and power subsidies, and supportive policies.

Going ahead, the country is also expected to see rapid growth in infrastructure, with 35+ data centers with 5.7+ million sq. ft. and 987+ megawatt (MW) capacity have been announced for 2026 and beyond.

Keeping these developments and growth plans in mind, today we will be having a look at some of the data center stocks which have shown tremendous growth, in the past one year.

We have filtered these stocks based on their fundamentals and the growth their share prices have shown during the past one year.

Let's have a closer look...

#1 Aurionpro Solutions

First in the list is Aurionpro Solutions.

Aurionpro Solutions provides business solutions in the fields of transaction banking, customer experience (ACE Platform), smart city and smart transportation, and cybersecurity.

The company offers software products and consulting services to the banking industry in India and abroad.

Coming to Aurionpro's financials, the revenue for the company grew by 32% YoY to Rs 2.8 bn, in Q2 FY25.

The operating profit for the quarter rose by 23% YoY to Rs 560 m, with the operating profit margin at 20.3%, versus 22%, in Q2 FY24.

The operating profit margin during the quarter was impacted by rapid growth and increased investments in product development and market expansion.

The net profit for the quarter increased by 34% YoY to Rs 460 m, with the net profit margin at 16.5%, slightly above the guided range of 15-16%.

Here is the table showing the annual financial performance of the company.

Aurionpro Solutions Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	-10%	-20%	35%	31%	35%
Operating Profit Margin (%)	19%	22%	22%	22%	22%
Net Profit Margin (%)	7%	-51%	15%	15%	16%
Return on Capital Employed (%)	18%	18%	21%	27%	32%
Return on Equity (%)	8%	-8%	22%	25%	22%

Data Source: Ace Equity

Here is the chart of the stock for the past one year.

Aurionpro's share price has grown by 66.7%, in past one year. Over the past 3 years and 5 years, the share price has grown by a compounded annual growth rate (CAGR) of 142% and 127%, respectively.

The company's current order book stands at approximately Rs 11.5 bn, split roughly 40:60 between banking and technology innovation segment.

Going forward, Aurionpro Solutions plans to leverage its strengths in banking software, enterprise AI, and transit technology while exploring new markets and expanding its offerings.

The company is also expanding its footprint in high-growth regions such as Southeast Asia, the Middle East, and the Americas, where it has already established strong pipelines.

Moreover, in the data center segment, the company aims to develop productised solutions and expand its services portfolio to cater to the rising demand for hybrid cloud infrastructure.

The company is confident of achieving a guided growth of over 30% for FY25 while maintaining earnings margins.

To know more about the company, check out Aurionpro Solutions' fact sheet and quarterly results.

#2 Cummins India

Next on the list is Cummins India.

Cummins India designs, manufactures, distributes and services diesel and alternative fuel engines from 2.8 to 95 litres, diesel and alternative-fuelled power generator sets of up to 3,000 kW (3,750 kVA), as well as related components and technology.

Cummins is a provider of backup power solutions for the data center industry, with the largest dedicated support network coverage in the world. This makes Cummins India, one a key beneficiary of the booming data center investment wave.

The company provides generation systems in various segments, such as infrastructure, IT/ITES, data centers, reality, and healthcare.

Coming to its financials, Cummins India reported an increase in sales of 31% YoY to Rs 24.9 bn, in Q2 FY25 from Rs 19 bn, in the same quarter last year.

The operating profit for the quarter saw an increase of 42% YoY to Rs 4.8 bn, while the operating profit margin for the quarter stood at 19%, versus 18%, in Q2 FY24.

Profit after tax for the quarter was Rs 4.5 bn, a 37.5% increase compared to the same quarter last year. The net margin for the quarter stood at 18.1% versus 17.3%, in Q2 FY24.

Here is the table showing annual financial performance of the company.

Cummins India Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	-9%	-16%	42%	26%	16%
Operating Profit Margin (%)	35%	36%	33%	32%	36%
Net Profit Margin (%)	11%	14%	14%	16%	20%
Return on Capital Employed (%)	12%	14%	14%	15%	19%
Return on Equity (%)	17%	19%	21%	27%	35%

Data Source: Ace Equity

Here is the chart of the stock for the past one year.

Cummins India's share price has grown by 80.7%, in past one year. Over the past 3 years and 5 years, the share price has grown by a CAGR of 53% and 43%, respectively.

Coming to the management's guidance, it has acknowledged the pressure on the gross margin, attributing it to the product mix and project execution.

It anticipates that gross margins will stabilize as the product mix normalises and ongoing cost reduction efforts materialise.

Additionally, the management is also focused on maintaining the operating margins through operational efficiencies and cost management strategies.

Looking ahead, the management expects double-digit revenue growth in FY25.

For more details, see the Cummins India company fact sheet and quarterly results.

#3 ABB India

Next on the list is ABB India.

ABB India stands out as a strong contender to benefit from the growing investments in the data center space due to its wide range of solutions tailored to the unique needs of data centers.

In the area of power distribution, ABB India offers an extensive portfolio that includes transformers, circuit breakers, switchgear, and remote power panels.

Its high-efficiency transformers are particularly noteworthy for their ability to minimise energy losses, making them ideal for modern data centers.

Coming to the financials, ABB India has registered a sales growth of 5.2% YoY to Rs 29.1 bn.

The operating profit increased 23% YoY to Rs 5.4 bn. The operating margin in turn also increased to 19%, from 16%, in Q2 FY24.

The management has recognised the increase in the operating profit margin, expecting it to stabilise as commodity prices normalise.

The net profit for the quarter stood at Rs 4.4 bn, an increase of 21% YoY. The net profit margin for the quarter stood at Rs 15.1%, versus 13.1%, in in Q2 FY24.

Here is the table showing annual financial performance of the company.

ABB India Solutions Snapshot (2020-24)

	Dec-19	Dec-20	Dec-21	Dec-22	Dec-23
Revenue Growth (%)	9%	-20%	19%	24%	22%
Operating Profit Margin (%)	37%	36%	36%	38%	39%
Net Profit Margin (%)	7%	5%	8%	11%	14%
Return on Capital Employed (%)	4%	4%	8%	12%	12%
Return on Equity (%)	14%	7%	16%	23%	31%

Data Source: Ace Equity

Here is the chart of the stock for the past one year.

ABB India's share price has grown by 60%, in past one year. Over the past 3 years and 5 years, the share price has grown by a CAGR of 46% and 41%, respectively.

Looking ahead, ABB India is positioned well for future growth with a diverse portfolio, strong market demand, and a commitment to sustainability.

The management is optimistic about continued growth driven by strong pipeline and market demand.

It remains confident despite some short-term challenges, emphasising ongoing improvements and strategic partnerships.

For more details, you can have a look at the ABB India company fact sheet and quarterly results.

#4 Voltas

Next on the list is Voltas.

Voltas manufactures and sells a diverse range of products, including air coolers, air conditioners, washing machines, and dishwashers.

Its prominence in the commercial air conditioning segment is underscored by its specialised cooling solutions tailored for data centers.

It's strong presence in the data center space positions Voltas to benefit significantly as India's total data center investments are projected to surpass US$ 100 bn by 2027.

Coming to the financial performance of Voltas, in Q2 FY25, it reported an increase in sales of 14.2% YoY to Rs 26.1 bn.

The operating profit for the period saw a massive increase of 251% YoY to Rs 1.3 bn. The operating margin in turn also increased to 5%, from 2%, in Q2 FY24.

The net profit after tax surged by 214% to Rs 1.3 bn. The net profit margin also rose to 5.1%, versus 1.6%, in Q2 FY24.

Here is the table showing annual financial performance of the company.

Voltas Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	8%	-1%	5%	20%	31%
Operating Profit Margin (%)	27%	26%	26%	22%	21%
Net Profit Margin (%)	8%	8%	7%	5%	3%
Return on Capital Employed (%)	7%	7%	6%	1%	2%
Return on Equity (%)	18%	15%	13%	10%	9%

Data Source: Ace Equity

Here is the chart of the stock for the past one year.

Voltas' share price, in the past one year has increased 103.8%. In the past 3 years and 5 years, the share price has grown by a CAGR of 12% and 21%, respectively.

Going forward, the company anticipates a lean season for cooling products in Q3 FY25, with a slight expectation of the festive period boosting demand.

The management acknowledges the impact of external factors, including geopolitical tensions and inflation on business performance.

It remains optimistic despite economic uncertainties and plans to continue to focus on growth and market share expansion.

For more details, consider having a look at the Voltas company fact sheet and quarterly results.

#5 Anant Raj

Last in the list is Anant Raj.

Anant Raj is primarily engaged in the development and construction of IT parks, hospitality projects, office complexes, shopping malls and residential projects in the State of Delhi, Haryana, Andhra Pradesh, Rajasthan, and NCR.

The company has successfully developed more than 20 million square feet (MSF) of real estate projects in the housing, commercial, it parks, shopping malls, hospitality, residential and affordable housing sub-segments.

Additionally, the company has forayed into data centre with commercial property of potential leasable area 5.66 msf to be converted into a 300-megawatt (MW) data center. The company has tied up with key government agencies.

Coming to its financials, Anant Raj achieved a revenue of Rs 5.1 bn, a growth of 55% YoY for Q2 FY25.

The operating profit stood at Rs 1.1 bn for Q2 FY25, with a YoY growth of 40%. The operating margin saw a decline to 22% versus 24%, in Q2 FY25.

The net profit after tax for Q2 FY25 was Rs 1 bn, indicating a remarkable 75% growth YoY. The net margin increased to 20.7% versus 18.1%, in Q2 FY24.

Here is the table showing annual financial performance of the company.

Anant Raj Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	-21%	-10%	85%	107%	55%
Operating Profit Margin (%)	19%	14%	16%	21%	23%
Net Profit Margin (%)	9%	4%	11%	16%	18%
Return on Capital Employed (%)	1%	1%	2%	6%	9%
Return on Equity (%)	1%	NM	2%	5%	7%

Data Source: Ace Equity

Below is the chart of the stock for the past one year.

Anant Raj's share price has shown tremendous growth in past one year, rising an impressive 173%. While over the course of 3 years and 5 years, the share price has increased by 128% and 118%, respectively.

During the quarter, the company has observed an increase in the contribution of data center revenues.

The company has announced a fund-raising programme as part of its growth strategies, focused on the data center business worth Rs 21 bn. The company is planning to raise Rs 20 bn from the market, while the promotors are planning to contribute the rest.

Going forward, the company plans to compete with major players in the cloud space, leveraging partnerships for technical support, while maintaining ownership of the infrastructure.

The management has acknowledged the competition in the data center space, while remaining confident in the company's established capabilities and infrastructure.

For more details, consider having a look at the Anant Raj company's fact sheet and quarterly results.

Conclusion

Looking ahead, the growing demand from sectors like BFSI, technology, and telecommunications, along with state-level policy incentives, is expected to continue driving the growth of India's data center industry.

However, the lack of reliable and high-speed internet connectivity hampers the efficient functioning of data centers.

Additionally, India's regulatory environment is inconsistent, similar to that of the United States, where each state has its own interpretations of the law.

Consequently, an operator looking to build across multiple sites in different states must comply with various regulations. These regulations can encompass a range of issues, including tax legislation, energy requirements, and sustainability standards.

For these reasons, understanding pros and cons of the industry, and evaluating every company judiciously, is of utmost importance.

Additionally, it's important to conduct thorough research on financials and corporate governance before making investment decisions, ensuring they align with your financial goals and risk tolerance.

Happy Investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...