Which Data Centre Share is Best in India for Long-Term Investment?

Compare Data Centre Stocks in India

Introduction

Data centre stocks can become the next multi-bagger. You must have heard about the digital boom or seen news about companies building massive data centres. But are there any Indian shares which caters to the data centre’s theme? Which are a few good long term stock?

Let’s dive into the world of data centres, explore what’s driving this industry. We’ll also figure out which stocks might be worth our money for the long term.

Why Data Centres Are a Big Deal

Data centres are like the backbone of our digital lives.

Every time you send a WhatsApp message, stream a movie on Netflix, or pay via UPI, a data centre is working behind the scenes.

Data Centre’s are basically huge buildings packed with servers that store and process data.

The demand for data centres is skyrocketing, in India as well. Why? Because we’re going digital in a big way.

Our internet usage is growing fast.

• In 2024, over 55% of Indians were online, and each person was using around 21 GB of data per month.
• Compare that to 2019, when it was just 11.5 GB per month.

With more people shopping online, working from home, and using apps, data centres are in high demand. Plus, the government’s push for Digital India and rules like data localisation. As per this rule, certain data must stay in India. Hence, companies are build more data centres here (locally).

The numbers are impressive too.

The data centre industry is worth about $10 billion now and could hit $18 billion by 2026. Capacity is expected to grow from 3.31 thousand MW in 2025 to 6.69 thousand MW by 2030.

So as a stock investor, investing in this sector feels like betting on the future of India’s digital economy.

But which companies should you look at?

What Makes a Good Data Centre Stock?

Before we talk about specific companies, let’s think about what makes a data centre stock a solid long-term pick.

It’s not just about who’s building the most data centres. You need to look at a few other things.

• First, is the company financially strong? A good balance sheet means they can invest in growth without drowning in debt.
• Second, do they have a clear focus on data centres, or is it just a small part of their business?
• Third, are they ready for the future, like adopting AI or green energy?
• And finally, is the stock price reasonable, or are you paying too much for the hype?

As a stock investor, I like companies that have a clear plan, good management, and a track record of delivering results.

Data centres are a capital-heavy business, so companies need to manage costs well.

Plus, with sustainability becoming a big deal, companies using renewable energy might have an edge.

So, let’s keep these points in mind as we explore the top players.

The Big Players in India’s Data Centre Space

India has several companies involved in data centres, but not all are pure-play data centre stocks.

Some are part of larger conglomerates, while others are focused solely on this sector.

I’ve looked at the market, checked financials, and read up on what experts are saying.

Here are three companies that stand out for long-term investment:

1. E2E Networks,
2. Netweb Technologies, and
3. Black Box Limited
4. Quick Comparison of the three

I’ve heard these stocks getting a mention time an again in podcasts and news reports. After digging deeper, I think they’re worth discussing in this blog post.

1. E2E Networks

E2E Networks is a small but exciting player in the data centre space.

Based in Delhi, this company provides cloud and data centre services. Their big big focus is on artificial intelligence (AI).

Why does that matter? AI needs powerful servers and high-speed computing. E2E is building infrastructure for this. They’re like the ones providing the tools for companies to create the next ChatGPT & Gemini.

What’s interesting is that Larsen & Toubro (L&T), a giant in construction, bought a 15% stake in E2E as per 04-Dec-2024 reports (read here). When a big name like L&T invests, it’s a sign the company has potential.

E2E’s financials are strong too.

• The company’s current market cap is about Rs.5,100 crore.
• In last 5 years (since March’21), their revenue from operations (sales) have grown from Rs.35 crore to Rs.163 crore. That’s a CAGR of 36% per annum.
• But E2E is expensive. Its price-to-earnings (P/E) ratio is around 109. It means you’re paying a lot for future growth.
• The stock is also 52% below its all-time high, so there might be a chance to buy if it corrects further.

See comparison here

I like E2E because it’s focused on AI, which is the future. But I’d keep it on my watchlist and wait for a better price (deeper corrections).

2. Netweb Technologies

This company make supercomputers.

Their supercomputers are used by IITs and research institutes for complex tasks like AI and scientific experiments.

Netweb also provides cloud and data centre services, making it a strong player in this space.

Netweb’s financials are solid.

• Their market cap is around Rs.10,300 crore.
• Their sales have grown from Rs.724 crore in March’2024 to Rs.1149 crore in March’2025. This is a growth rate of about 26% in one year.
• Their return on capital employed (ROCE) is an impressive 29.3%. It is a sign that they use money efficiently.
• But like E2E, Netweb is pricey, with a P/E ratio of 90. That’s high, but it also reflects the market’s belief in their growth.

See comparison here

What I like about Netweb is their focus on high-tech hardware.

They’re also eligible for government incentives under the Production Linked Incentive (PLI) scheme, which could boost their growth.

However, their business depends on both manufacturing and cloud services, so any slowdown in IT spending could hurt them.

Still, with AI demand growing, Netweb feels like a strong contender for the long term.

3. Black Box Limited

Black Box Limited is a bit different from the above two.

E2E and Netweb are purely Indian play. Black Box gets 77% of its revenue from the US.

They provide IT infrastructure services, including setting up data centres for big companies like Dell, Intel, TCS etc.

Think of them as the ones who design and maintain the complex systems that keep data centres running.

Black Box’s financials are attractive.

• Their market cap is around Rs.8,700 crore.
• Their P/E ratio is much lower at 42.84. This making it the cheapest of the three.
• In last five years (between Mar’21 and Mar’25) their sales have grown at just about 9% standing today at Rs.5,966 crores. But their net profit has grown at 21% per annum in last 5 years.
• Both their ROE and ROCE is a solid at about 26%.
• The company has an equity base of about Rs.758 crores and D/E ratio of 0.86 which is high.

See comparison here

What makes Black Box stand out is its valuation and global exposure.

But there’s a risk. If the US economy slows down (say, due to policies under someone like Trump), their business could take a hit.

Still, with a vaerage trunover of about Rs.5,000 crores in last 5 years, and a strong order book, I think they have good visibility for future earnings.

I find Black Box appealing because it’s reasonably priced and has a strong client base.

Other Companies to Consider

E2E, Netweb, and Black Box are focused data centre players.

There are other companies worth mentioning:

• STT Global Data Centers India is a big name, with 30 data centres and 400 MW capacity (non listed).
• CtrlS Datacenters is another leader, planning to add 400 MW in Telangana (non listed).
• Then there’s Nxtra by Airtel, which has 12 data centres and plans to double its capacity to 400 MW (not listed).

These companies are doing great work, but they’re not listed as standalone stocks. For example, Nxtra is part of Bharti Airtel, and STT is a subsidiary of a Singapore-based firm.

Big conglomerates like Reliance and Adani are also entering the space.

• Reliance’s Jio is building data centres in Navi Mumbai.
• AdaniConneX plans to hit 1 GW capacity in the next decade.

But investing in these means buying shares of Reliance Industries or Adani Enterprises, where data centres are just one small part of their business.

For pure exposure to data centres, the three I’ve discussed are better bets.

What’s Driving the Data Centre Boom?

Let’s take a step back and look at why data centres theme are among the future industries to invest in.

• First, India’s digital economy is growing fast. By 2025, it could be worth $1 trillion, up from $200 billion in 2018.
• Second, AI is changing everything. Companies need powerful data centres to run AI models. India is becoming a hub for data centers.
• Third, government policies are helping. Rules like the DPDPA 2023 ensure data stays in India, pushing companies to build local data centres. States like Maharashtra and Uttar Pradesh are offering cheap land and power to attract investment.
• Fourth, Data Centres look like a sustainable investments. Data centres use a lot of electricity, so companies are moving to renewable energy. By 2030, 50% of data centres could run on green power. This is good for the planet. Hence, data centre companies look more attractive to investors who care about ESG (Environmental, Social, Governance) factors.

All these trends point to a bright future for the industry.

Associated Risks

First, these are capex heavy and power-hungry businesses. If India’s power grid struggles to keep up, companies could face challenges. Some are exploring nuclear power or solar, but that’s still in early stages.

Second, the stocks I’ve mentioned are expensive. High P/E ratios can mean two things: they are expensive as of today, and they must also report high growth rates to justify it. If that doesn’t happen, the stock could crash.

Third, competition is heating up. With global giants like Amazon and Microsoft entering India, smaller players might struggle to compete.

There’s also the risk of a global slowdown. If the US or other markets cut IT spending, companies like Black Box could feel the pinch first.

As an investor, you need to be ready for these bumps.

Diversifying your portfolio and not putting majority of your money in one theme is always a good idea.

Which Stock Should I’ll Pick?

So, which data centre share is best for the long term?

Honestly, it depends on our goals and risk appetite.

If you’re excited about AI and okay with paying a premium, E2E Networks is a great choice. Its focus on high-speed computing and strong financial growth make it a promising pick. But I’d wait for the P/E to drop closer to 50–60.

If you believe in India’s tech innovation, Netweb Technologies is another solid option. Their supercomputer expertise and government support are big pluses. But again, the high valuation is a concern here as well.

Black Box Limited feels like the safest bet to me right now.

Its lower P/E ratio, strong client base, and global exposure make it attractive. Yes, the US market risk is there, but their focus on high-profit projects and $500 million order book give me confidence.

If I had to pick one stock today, I’d lean towards Black Box, but I’d keep E2E and Netweb on my watchlist for future dips.

A Quick Comparison

To make things easier, here’s a simple table comparing the three companies:

Description	E2E Networks	Netweb Tech	Black Box Ltd
Market Cap (Rs.Cr.)	5,100	10,300	8,700
Sales (Rs.Cr.)	163	1,149	5,967
Sales Growth (5Y)	36% p.a	26% p.a	5.15% p.a.
PAT (Rs.Cr.)	47.49	114.48	204.78
PAT Growth (5Y)	49.1% (4Yr)	50.8% (2Yr)	21.26% p.a.
ROE / ROCE	2.98% / 4.55%	21.58% / 29.28%	26.98% / 25.09%
Net Worth (Rs.Cr.)	1,592.77	530.33	758.74
D/E	0.01	0.00	0.86
P/E	108.66	90.5	42.84
Below All Time High	-52%	-36%	-25%

Conclusion

The data centre industry is growing fast.

Companies like E2E Networks, Netweb Technologies, and Black Box Limited looks positioned to benefit.

But I’ll still not rush in blindly. Why? Because at present price levels, they look very expensive (Black Box is a bit reasonable).

Like me, you too probably want a stock that’s not too pricey but has strong growth potential (see GARP stocks). That’s where Black Box feels like a good pick.

But all three deserve a spot on your radar.

What do you think? Are you excited about data centres, or is there another sector you’re eyeing? Drop a comment. And if you found this post helpful, please follow me on WhatsApp for so that you don’t miss my new posts.

Have a happy investing.