In the first half of 2024, India’s data centre industry has witnessed a remarkable surge, with usage nearly doubling to approximately 200 megawatts (MW). This growth, detailed in a recent report by Savills India, underscores a significant expansion in IT infrastructure across key micromarkets.
During this period, the addition of around 71 MW of IT capacity has propelled the total operational stock to 942 MW, reflecting a 21% year-on-year increase from the 778 MW recorded in the same timeframe in 2023. This spike in capacity is attributed to heightened demand from hyperscalers, BFSI (Banking, Financial Services, and Insurance), IT & ITeS sectors, and various service industries, all of which increasingly depend on data centre operators for colocation and related services. Mumbai remains the dominant player in the data centre market, holding a substantial 54.9% share of the total capacity. Chennai follows with 12.3%, Bengaluru with 8.2%, and Pune with 7.2%. Notably, hyperscalers contribute 22% of the total stock, while enterprises account for 10%, with the remaining 68% utilised by a blend of these two categories, highlighting a diverse utilisation pattern within the sector.
The industry has seen a significant uptick in colocation services, driven by factors such as high capital and operational expenditures, uncertainty in future demand, and scalability concerns. The high costs associated with security systems and high-performance GPUs, along with elevated real estate prices, are making enterprise colocation increasingly appealing to businesses and operators alike. Looking ahead, Savills India projects a robust demand for data centre capacity, estimating a requirement of 400 MW by the end of 2024, while supply is expected to reach 350 MW. Operators are expanding their services beyond traditional colocation to include networking, cloud solutions, specialised hardware like GPUs, and other managed services. This growth is driven by increased internet usage, the rise of 5G, the need for ultra-low latency, and growing adoption of AI and IoT technologies, all of which are creating a burgeoning need for data centre services.
