Top Data Centre Stocks India (Week of May 10, 2026)

Sector Pulse

The Data Centre and compute infrastructure sector is witnessing a sharp divergence in performance between constituents. NETWEB Technologies delivered a record-breaking quarter with revenue surging 141% YoY to ₹8,049 million, fueled by the preponement of a massive AI order. Conversely, Black Box Ltd (BBOX) reported more modest revenue growth of 11% YoY, as its execution was hampered by industry-wide supply chain bottlenecks. While demand remains high across the board, the ability to secure critical components like GPUs and optical fibers has become the primary differentiator for top-line delivery.

Catalysts Playing Out Across the Pack

The dominant catalyst is the 'order_book_or_contract_wins' taxonomy. BBOX maintains a backlog of $601 million and is chasing a $1 billion booking target for FY26. NETWEB's strategic order book stands at ₹17,336 million, providing high visibility for FY27. Additionally, 'tam_expansion_changing_consumption' is evident as AI systems now account for 64% of NETWEB's revenue. BBOX is also looking at 'geographical_expansion' through its Brazil acquisition, which is expected to contribute INR 500 crore in FY27.

What Managements Are Guiding

Guidance for the remainder of FY26 is cautious regarding margins but optimistic on demand. BBOX lowered its revenue guidance to INR 6,325–6,375 crore, citing fiber shortages. NETWEB lowered its EBITDA margin guidance to the 13-14% range, acknowledging that large strategic orders carry a lower margin profile. However, both managements are signaling that these are execution-related adjustments rather than demand-side issues.

Sub-Sector Aggregates

Aggregate metrics reveal an EBITDA margin range of 8.9% to 12.2% across the analyzed constituents. Revenue growth shows a wide variance from 11% to 141%, reflecting the lumpy nature of large-scale infrastructure projects. The sector is also seeing an improvement in working capital, as evidenced by NETWEB's cash conversion cycle dropping to 69 days from 120 days.

Shared Risks (9-type taxonomy)

'Logistics' and 'Commodity' risks are the most pressing. BBOX highlighted a shortage of optical fibers and GPUs, while NETWEB noted global shortages in DRAM and HBM memory. 'Labor' risks appeared as a one-time INR 6 crore charge for BBOX due to India's new Labor Code. 'FX' remains a low-level risk, with NETWEB hedging 60% of its import payables to mitigate currency volatility.

Bottom Line

The sector is in a high-growth phase driven by AI infrastructure demand, but execution is currently capped by global component shortages. While order books are at record levels, margin compression and supply chain delays necessitate a selective approach, favoring players with proactive procurement strategies.