The data center market in India is expected to grow at a CAGR of over 4% during the period 2019–2025.
The following factors are expected to contribute to the growth of the data center market in India during the forecast period: •Migration to cloud-based business operations •Government to grow the digital economy through supporting data center development •Big data and IoT to increase Data Center Investment •Increased Adoption of Converged and Hyper-converged Infrastructure Platforms
As the number of standalone colocation services in India is low than managed colocation or managed hosting services, several small enterprises in India prefer managed hosting or cloud services rather than colocation. Sectors such as BFSI, logistics, transportation, e-commerce, and government agencies are witnessing high demand for colocation services. Global enterprises involved in establishing a physical presence in the Indian market are colocating facilities in the country. Hence, the increased investment from global colocation service providers is likely to influence the India data center market during the forecast period.
The favorable government support in the form of tax incentives is another key factor accelerating market growth in India. Telangana, Gujarat, Andhra Pradesh, and Maharashtra governments are providing considerable incentives for data center development. For instance, the Maharashtra government announced the GST refund for a maximum period of 10 years for the companies that participate in the development of integrated facilities. Similarly, the Andhra Pradesh government announced to provide 50% reimbursement of SGST on the purchase of raw materials and equipment for three years from the date of approval of the project. Therefore, increasing government support is likely to influence the data center development in India.
The report considers the present scenario of the data center market in India during the forecast period and its market dynamics for the forecast period 2020?2025. It covers a detailed overview of several market growth enablers, restraints, and trends. The report profiles and examines leading companies and several other prominent companies operating in the market.
Data Center Market in India: Segmentation
This research report includes detailed segmentation by IT Infrastructure, Electrical Infrastructure, Mechanical Infrastructure, General Construction, Tier Standards, and Geography. The adoption of server infrastructure is dominated by rack servers, which account for over 70% of the market share. However, tower servers are experiencing a negative growth rate. The adoption of converged and hyper-converged infrastructure solutions will have a high impact on the server market growth during the forecast period. The increased adoption of all-flash storage arrays and hybrid storage arrays is boosting the demand for storage systems. High-performance operations aid the growth of flash storage systems in data centers that require strong I/O capabilities. The data center market in India is witnessing significant growth in the data, which requires flash arrays as they offer high storage performance, especially in the virtualized data center environment.
The unstable grid connectivity in India makes UPS systems a critical component for uninterrupted service operations. CtrlS in its Hyderabad facility adopts power systems with up to 2(N+1) redundant configuration. SIFY Technologies in its Kolkata facility has adopted UPS systems with 500kW in N+N redundant configuration. Mumbai has witnessed the highest power capacity addition with investments from Yotta (Hiranandani Group), SIFY Technologies, CtrlS, and Bridge Data Centres. The data center market by power capacity is expected to grow during the forecast period as the solar energy potential in Karnataka is estimated to exceed 24.7 GW. This will be a major benefit for service operators to power their facilities through solar energy.
The use of water-based cooling is likely to increase in the India data center market during the forecast period. However, the scarcity of water in a few cities will pose a challenge for facility operators in supporting operations. Most facilities are powered with air-based cooling systems. For instance, Netmagic recently established facilities in Mumbai and Bengaluru are equipped with air-based cooling systems of N+2 redundancy. The redundancy of cooling systems is N+1 or N+N configuration among tier III facilities. Tier IV facilities adopt the 2N+1 redundant configuration for cooling systems. The redundancy of CRAC and CRAH units is higher than other systems. The use of dual water feeds with on-site water treatment plants is also gaining popularity in the Indian market.
The India data center market has a strong presence of construction contractors and sub-contractors. Sterling & Wilson, VatsuNidhi Architects, and L&T Construction are among the leading local contractors in the market. They also carry out installation and commissioning services. Most government facility development projects are carried out through tenders. The expertise of the construction contractor plays a vital role in attaining these projects. Besides, partnerships with colocation providers will yield significant revenue opportunities for contractors.
With the increasing focus on building highly efficient and reliable data centers, the investment in Tier IV facilities is expected to grow in India. Most new facilities are designed as Tier III standards with minimum N+1 redundancy and can be reconfigured with up to 2N redundancy as the demand arises. The data center market in India witnessed the development of around 20 Tier III category projects. This trend is likely to continue during the forecast period, with many large operators expected to move to tier IV category due to the growth in rack power density and critical applications.
Investments from CtrlS, GPX Global Systems, and Pi DATACENTERS will continue to grow the revenue for the Tier IV category in the market. Building a Tier IV facility in India will cost around $5-6 million. The labor cost is low than in developed countries, thereby reducing the construction cost to a considerable extent.
Market Segmentation by IT Infrastructure •Servers •Storage •Network Market Segmentation by Electrical Infrastructure •UPS Systems •Generators •Transfer Switches and Switchgears •Rack PDU •Other Electrical Infrastructures Market Segmentation by Mechanical Infrastructure •Cooling Systems oCRAC & CRAH units oChiller Units oCooling Towers, Dry Coolers, & Condensers, oOther Cooling Units •Racks •Others Mechanical Infrastructure Market Segmentation by General Infrastructure •Building Development •Installation and Commissioning Services •Building Designs •Physical Security •DCIM & BMS Market Segmentation by Tier Standards •Tier I &II •Tier III •Tier IV
Insights by Geography
Mumbai, Bengaluru, Chennai, Delhi, and Hyderabad will be the major cities driving data center growth throughout the forecast period. AWS, Microsoft, Google, Alibaba, IBM, and Tencent have established their physical presence in the cities mentioned above. The global service providers such as Equinix and Digital Realty are expected to invest in the market during the forecast period. Recently, Digital Realty partnered with Adani Group to develop data centers in India. Moreover, government initiatives to migrate all their operations to the cloud platform to push digital economy will aid in the development of multiple facilities in states such as Kerala, Assam, West Bengal, Andhra Pradesh, Gujarat, Madhya Pradesh, Odisha, Bihar, Jharkhand, Uttar Pradesh, Haryana, Punjab, Himachal Pradesh, and Jammu & Kashmir.
Key Regions •Karnataka •Maharashtra •Other States •Telangana & Andhra Pradesh
Key Vendor Analysis The India data center market is witnessing steady growth in terms of IT infrastructure procurement, greenfield, brownfield, and modular facility development. It is likely to adopt efficient, scalable, flexible, and reliable infrastructure solutions. The market has evolved over the years with multiple innovations focused on enabling flexible and scalable enterprise operations in the era of cloud, big data, Internet of Things, and Artificial Intelligence in industries. In terms of support infrastructure perspective, the market is witnessing the high adoption of solutions, which help to reduce power and water consumption and decrease CO2 emissions. Moreover, the market has a strong presence of vendors in the three categories: IT infrastructure, support infrastructure, and data center investors. Tata Consultancy Services (TCS), Wipro, Cognizant, Infosys are the major contributors to the market offering managed data center services. Managed services majorly dominate the colocation market in the country.
Data Center Critical (IT) Infrastructure Providers •Atos •Arista •Broadcom •Hewlett Packard Enterprise (HPE) •Cisco •Dell Technologies •Huawei •International Business Machines Corp. (IBM) •Lenovo •NetApp
Prominent Investors •Bridge Data Centres •BSNL Data Center •Bharti Airtel (NXTRA DATA) •Colt Data Centre Services (Colt DCS) •CtrlS •GPX Global Systems •ITI Limited •NTT Communications •Pi DATACENTERS •Reliance Communications •Sify Technology •ST Telemedia Global Data Centres (STT GDC) •Yotta Infrastructure
Prominent Support Infrastructure and Construction Services Providers •ABB •Caterpillar Inc. •Climaveneta (Mitsubishi Electric) •Cummins •Delta Group •Eaton •KOEL (Kirloskar Group) •Larson & Toubro (L&T) •Legrand •MTU On Site Energy (Rolls-Royce Power Systems AG) •Netrack Enclosures •Riello UPS •Rittal •Schneider Electric •Sterling and Wilson (Shapoorji Pallonji Group) •STULZ •Vastunidhi •Vertiv
Key Market Insights Include The report provides the following insights into the data center market in India during the forecast period 2020–2025. 1.It offers comprehensive insights into current industry trends, forecast, and growth drivers about the data center market in India. 2.The report provides the latest analysis of share, growth drivers, challenges, and investment opportunities. 3.It offers a complete overview of segments and the regional outlook of the data center market in India. 4.The study offers a detailed overview of the vendor landscape, competitive analysis, and key strategies to gain competitive advantage.
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