Synopsis: A new state policy targets massive capacity additions in one of the fastest growing segments of India’s digital economy, and a set of listed companies could see direct business gains from the buildout.
State governments are increasingly competing to attract capital into digital infrastructure as demand for computing power rises sharply. A large policy push in one western state now aims to build significant new capacity over the coming years, with incentives designed to draw both global and domestic players into large scale projects.
Gujarat Rolls Out Its First Data Centre Policy
Gujarat has unveiled its first Data Centre Policy for the period 2026-29, aiming to position the state as India’s leading destination for hyperscale data centres, cloud computing and AI-driven digital infrastructure. The policy targets investments of ₹6 lakh crore and the creation of 7.5 GW of data centre capacity during the policy period.
The policy offers a wide set of fiscal and non-fiscal incentives. These include a 2.5% capital subsidy on eligible fixed capital investment for projects in the Dholera region, an interest subsidy of up to 4% for 10 years subject to an annual cap of ₹25 crore, a power tariff subsidy of ₹1 per unit for 20 years, and 100% reimbursement of electricity duty for 20 years.
It also offers complete exemption from stamp duty and registration charges, along with reimbursement of State GST on eligible plant and machinery, buildings, infrastructure and operational services for specified periods. Given the high water needs of data centres, the policy also supports captive desalination plants, offering assistance of 20% of eligible capital expenditure or ₹2 crore per MLD, subject to prescribed limits.
Gujarat has already received proposals for data centres with combined capacity of 10 GW, and the government plans to facilitate around 8 GW of this. The state is also expanding its digital backbone, with two operational cable landing stations and another project expected to be announced, to strengthen international connectivity for global cloud and hyperscale operators.
The policy is aimed at capitalising on the rapid growth of AI, cloud computing, digital payments, e-commerce, electronics manufacturing and other data-intensive sectors, while strengthening Gujarat’s position in India’s digital economy and helping it compete with established hubs such as Telangana, Maharashtra and Tamil Nadu.
Companies That Could Benefit From the Buildout
Techno Electric & Engineering
Techno Electric & Engineering could see gains on two fronts from Gujarat’s data centre push. The company has a growing presence as a data centre developer and also operates as a power infrastructure EPC (engineering, procurement and construction) player, which means it can participate both in building the facilities themselves and in the power infrastructure that supports them.
With Gujarat targeting 7.5 GW of new data centre capacity, demand for reliable power evacuation and infrastructure work is expected to rise sharply. Techno Electric’s dual exposure to data centre development and EPC work positions it to capture business across multiple stages of these upcoming projects.
ABB India
ABB India stands to benefit from rising demand for electrical equipment, which forms a core requirement for any large scale data centre project. As facilities scale up to serve AI and cloud computing workloads, the need for transformers, switchgear and other electrical infrastructure typically rises in tandem.
Given Gujarat’s plan to facilitate around 8 GW of data centre capacity, companies supplying critical electrical equipment could see a steady pipeline of orders over the policy period. ABB India’s established presence in industrial electrical equipment places it among the potential beneficiaries of this emerging demand.
Netweb Technologies
Netweb Technologies could benefit from higher demand for AI servers, a segment central to next-generation data centre requirements. As hyperscale and AI-focused facilities are built out under the new policy, the need for high-performance computing hardware is likely to increase.
The company’s focus on server and computing infrastructure aligns closely with the kind of AI-driven digital infrastructure the Gujarat policy is designed to attract. This positions Netweb Technologies to potentially gain from new data centre projects that require specialised server capacity.
Blue Star
Blue Star could see increased opportunities from demand for precision cooling solutions, which are essential for data centres given the heat generated by dense computing equipment. Effective cooling is a critical requirement for AI data centres in particular, where server density tends to be higher.
As new facilities come up across Gujarat under the policy, the need for advanced cooling systems is expected to grow alongside capacity additions. Blue Star’s presence in the cooling and HVAC (heating, ventilation and air conditioning) space could allow it to participate in this demand.
Sterlite Technologies
Sterlite Technologies may see increased opportunities from expanding optical fibre and digital connectivity requirements tied to the new data centre capacity. Large scale digital infrastructure projects typically require significant fibre network buildouts to support data transmission between facilities.
Gujarat’s plans to expand its digital backbone, including additional cable landing stations for international connectivity, could further support demand for fibre infrastructure. Sterlite Technologies’ presence in this segment positions it to potentially benefit as connectivity requirements scale up alongside new data centre projects.
INOX India
INOX India could benefit from demand for advanced cooling and cryogenic infrastructure used in large AI campuses. As data centre facilities scale in size and computing density, specialised cooling infrastructure becomes an important part of overall project requirements.
The company’s existing expertise in cryogenic and industrial gas infrastructure could translate into opportunities as large AI campuses come up under Gujarat’s new policy. This positions INOX India among companies that could see incremental business from the state’s data centre buildout over the coming years.
Conclusion
Gujarat’s Data Centre Policy marks a significant step in India’s push to close the gap between the volume of data it generates and the capacity it hosts domestically. With targeted investments of ₹6 lakh crore and 7.5 GW of planned capacity, the policy could position the state as a major hub for hyperscale and AI infrastructure. For companies across the data centre value chain, from power equipment and cooling to connectivity, the buildout presents a meaningful long-term opportunity as execution gets underway.
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