Artificial Intelligence is emerging as one of the biggest global investment themes, with industry estimates projecting annual AI-related spending to exceed $1 trillion over the next decade.
While software companies have attracted much of the attention, the growth of AI is expected to create opportunities across a much broader ecosystem. Demand for computing power, data storage, connectivity and electricity is likely to benefit sectors ranging from power generation to electrical equipment and telecom infrastructure.
Here are some of the Indian companies that could gain from the AI buildout.
Power and data centre plays
AI workloads require massive computing infrastructure, which in turn consumes large amounts of electricity.
India’s data centre market is estimated to grow from around $6-7 billion currently to more than $10 billion by 2030.
Companies to watch
- Reliance Industries
- Bharti Airtel
Both companies have exposure to cloud infrastructure and digital services that could benefit from rising AI workloads.
Power producers
Growing electricity demand from data centres could support power generation companies such as:
- NTPC
- Tata Power
- JSW Energy
- Adani Power
- Torrent Power
Among them, NTPC, with installed capacity exceeding 80 GW, is well positioned to cater to higher power demand from digital infrastructure.
Transmission companies
Expansion in data centres will also require stronger grid infrastructure.
Potential beneficiaries include:
- Power Grid Corporation of India
- Adani Energy Solutions
Higher investments in transmission networks could support long-term growth for these companies.
Telecom and connectivity
AI applications depend on the transfer of enormous amounts of data.
Companies with extensive fibre and networking infrastructure could see increased demand.
Key names
- Tata Communications
- Bharti Airtel
- Reliance Jio
These companies provide connectivity and enterprise networking services used by businesses and digital platforms.
Companies supplying AI infrastructure
Some companies have direct exposure to AI computing and data centre equipment.
Netweb Technologies
The company supplies:
- High-performance computing systems
- AI servers
- Data centre solutions
Black Box Ltd.
Its business includes:
- Digital infrastructure
- Networking solutions
- Data centre connectivity
E2E Networks
The company provides:
- Cloud infrastructure
- GPU computing services
These services allow enterprises to train and deploy AI models without investing in expensive hardware.
IT companies with AI exposure
Several IT firms are expanding their capabilities in enterprise AI and digital transformation.
Mid-cap IT companies
Persistent Systems
Focus areas include:
- Enterprise AI
- Digital transformation
Tata Elxsi
The company is deploying AI across:
- Automotive
- Healthcare
- Embedded engineering
Happiest Minds Technologies
Its offerings include:
- Generative AI
- Cybersecurity
- Digital modernization
Large-cap IT players
TCS
The company recently reported AI-related business with annualized revenues exceeding $2 billion.
Infosys
Infosys continues to expand its AI platform, Topaz, aimed at helping enterprises accelerate AI adoption.
Electrical equipment makers
Data centres require transformers, switchgear and power management systems.
Companies that could benefit include:
- Siemens India
- ABB India
- CG Power
- Hitachi Energy India
Rising investments in digital infrastructure could increase demand for these products.
Cooling and HVAC companies
AI data centres also need precision cooling systems.
Potential beneficiaries include:
- Voltas
- Blue Star
Growing data centre capacity may support demand for specialized cooling solutions.
A broader AI opportunity
Although AI is often viewed as a software-driven theme, many industries stand to benefit from the infrastructure required to support it.
Sectors that could gain
- Power generation
- Data centres
- Telecom infrastructure
- Transmission
- Electrical equipment
- HVAC systems
- IT services
Stocks investors may track
- NTPC
- Tata Power
- Power Grid
- Tata Communications
- Bharti Airtel
- Persistent Systems
- Tata Elxsi
- Siemens India
- ABB India
- Infosys
- TCS
TL;DR
AI spending could surpass $1 trillion annually over the next decade, creating opportunities beyond software. Indian companies in power, telecom, transmission, electrical equipment, data centres and IT services are among those that could benefit from rising AI infrastructure investments.
AI summary
- Global AI spending could exceed $1 trillion annually.
- Power and data centre companies may benefit from rising electricity demand.
- Telecom and transmission firms could gain from higher connectivity requirements.
- IT companies are expanding AI capabilities and platforms.
- Electrical equipment and HVAC players may also see increased demand.
