Why FIIs Are Betting On These 3 Data Centre Stocks Right Now?

By Ventura Research Team 4 min Read Apr 29, 2026

Summary:
Walk into any data centre and what you see is not particularly glamorous: rows of servers, racks of blinking lights, and enormous cooling systems working round the clock. But behind that unremarkable exterior sits one of the fastest-growing sectors in the world right now.

Every day, the world generates an extraordinary volume of data, estimated at around 402-403 million terabytes per day, driven by smartphones, e-commerce, streaming platforms, and increasingly artificial intelligence. All of this data needs to be stored, processed, and transmitted through physical infrastructure. Against this backdrop, India’s data centre market is emerging as a critical pillar of the digital economy. India’s data centre market valued at approximately $10 billion in 2025 is expected to more than double to $22 billion by 2030. This is not a niche or cyclical trend, it reflects a structural shift in how digital infrastructure is being built, scaled, and financed in an increasingly data-driven world.

Foreign institutional investors appear to have taken note. Several Indian companies connected to the data centre ecosystem have seen FII holdings tick upward in recent quarters. Here are three worth looking at.

1. Voltas Ltd

Voltas’ primary identity lies in its air conditioners, but in the role of data centers, it’s a utility player that comes into the picture in the capacity of cooling. With increased demand for AI workloads, heat management becomes a key challenge for data centers. The Commercial Air Conditioning unit within Voltas has been working on indigenously developed centrifugal chillers at its Waghodia plant, made especially for large capacity settings.

As of March 2026, FIIs hold 18.4% in Voltas. Looking at the shareholding data, FII holding has climbed steadily from 15% in June 2024, even as mutual fund holdings have drifted lower over the same period; from 25.3% to 14.7%. The overall institutional shareholding in this organization has remained stable between 56% and 57%.

As far as finance is concerned, Voltas has been able to boost its earnings as well as revenue at a CAGR rate of around 15%-10% and with ROE of 8% and ROCE of 12%. The company carries an order book of ₹6200 crore, which gives near-term revenue visibility. Management has indicated a 12-month ramp-up window for its data centre and district cooling business, so this is still early days rather than a fully established revenue stream.

FY26 was not straightforward for the company, macro pressures and supply chain disruptions were a factor across much of Indian manufacturing. But the direction of travel for the underlying business is reasonably clear.

2. ABB India

ABB India has been part of India's industrial infrastructure since 1949. Its connection to the data centre sector comes through its electrical and automation equipment; low-voltage and medium-voltage systems that make large-scale facilities more energy efficient. Around 30% of hyperscale data centres across India already use ABB solutions, which gives the company an established foothold rather than an aspirational one.

The company's ABB Genix platform, which combines industrial analytics with AI, is designed to help data centres and other technology-heavy environments improve operational reliability and reduce energy consumption: both of which matter considerably as data centre power density rises with AI workloads.

The FII holding picture for ABB India shows an interesting pattern. Holdings peaked at 12.1% in June 2024 and have since pulled back to 8.2% as of March 2026, though that figure does represent a modest uptick from 7.6% in the previous quarter. The broader institutional holding has remained in the 16 to 18% range throughout.

Financially, ABB India has been one of the stronger performers in the capital goods space: sales and net profit have grown at a CAGR of 18% and 50% respectively over five years, with average ROE of 21% and ROCE of 28%. Its order backlog stands at around ₹10400 crore. These are solid numbers for a company operating in a sector with genuine long-term tailwinds.

3. RailTel Corporation

RailTel is a government-owned telecom infrastructure company with a fibre network built on India's railway corridors. Its data centre ambitions are more recent but are moving at pace.

The company has partnered with Techno Electric & Engineering to develop edge data centres across 102 locations. It is building a 10 MW data centre in Noida through a private investment partnership. It has signed memoranda of understanding with Anant Raj and L&T to jointly offer colocation and managed services. In January 2026, it was announced that RailTel will establish a greenfield data centre for Ethiopia's Ministry of Foreign Affairs in Addis Ababa, an early sign of international ambition.

FII holding in RailTel has been rising for two consecutive quarters, reaching 3.72% as of March 2026. Though the overall institutional share is relatively lower at 4.7%, it has gone up from 3.6% from September 2024. The company’s sales and profits have been increasing at a compounded annual growth rate of 26% and 17%, respectively, for the last five years. With an order backlog of ₹10,166 crores, and being backed by Indian Railways, RailTel has been bagging large infrastructure contracts that are tough for the private sector.

The Bigger Picture

India's data centre capacity is expected to reach 2 GW in 2026, doubling from 0.9 in 2023. Drawing at least $30 billion in investments that year alone. Global technology companies including Microsoft, Google, and Amazon have each made multi-billion dollar commitments to Indian infrastructure over the coming years. The Indian government has granted data centres infrastructure status, enabling access to low-cost financing, fiscal benefits, and policy stability encouraging large-scale private and foreign investment.

What the FII buying in Voltas, ABB, and RailTel signals is not necessarily that these companies are pure data centre plays; none of them is. What it suggests is that institutional investors are looking beyond the obvious names and identifying companies whose existing businesses already serve the ecosystem in meaningful ways.

Whether that interest translates into sustained earnings growth will depend on execution. As always, investors should look at each company's valuations, corporate governance, and financial fundamentals before drawing conclusions from the direction of institutional flows alone.