Waaree Renewables, an Indian renewable energy provider, expands into the data center market to capitalize on growing AI infrastructure demand.
Waaree Renewable Technologies (WRTL) announced on Saturday that its subsidiary, Waaree Green Data Centers, has incorporated a new unit, Sunstar Data Centers, to develop, finance, own, and operate hyperscale, AI-ready, and edge data centres. In August, WRTL disclosed that Waaree Green would be merged into Waaree Energies, the group’s holding company, positioning Sunstar as an eventual step-down subsidiary under Waaree Energies.
India’s data centre capacity is projected to expand from 1.6 GW in mid-2026 to 6 GW by 2029, according to real estate advisory firm JLL. The shift toward artificial intelligence amplifies this opportunity significantly. WRTL management estimates that AI-driven facilities require at least 10 times more power than conventional data centres.
This expansion aligns closely with Waaree’s existing integrated energy stack. The group is deeply entrenched in solar power generation and is actively scaling its transmission, distribution, and storage capabilities. In June, it acquired a 55% stake in Associated Power Structures, bolstering its transmission and distribution (T&D) footprint, while battery energy storage systems (BESS) are emerging as another key growth driver. During the June quarter (Q1FY27), WRTL’s bidding pipeline featured over 10 GWh of BESS projects and ₹ 20,000 crore in T&D opportunities. The company reported a 53% year-on-year revenue increase to ₹ 925 crore, alongside a 38% jump in net profit to ₹ 120 crore.
Because renewable power requires robust storage and grid connectivity for effective utilization, it can deliver the reliable, clean energy that modern data centres increasingly demand. Consequently, Waaree’s entry into the sector represents a strategic downstream move—transitioning from constructing grid-connected renewable assets to directly developing, owning, and operating data centres. However, the group’s immediate focus remains on securing engineering, procurement, and construction (EPC) contracts within the sector. As of July, WRTL confirmed it holds no firm data centre orders, and Sunstar remains newly incorporated with operations yet to commence.
Data centres are capital-intensive, have long gestation periods, and require reliable power, specialized cooling, connectivity and operational expertise. Waaree is already navigating a substantial investment cycle, with Waaree Energies carrying ₹ 31,500 crore in announced projects, of which ₹ 22,000 crore is slated for deployment by FY29. Adding data centre development to this portfolio could further strain the company’s capital allocation and execution capacity.
Following a roughly 25% decline over the past year, Waaree Energies shares trade at approximately 8.6 times EV/EBITDA, based on FY28 Bloomberg consensus estimates. While the data centre boom presents a substantial opportunity and Waaree’s vertically integrated power model offers a distinct competitive advantage, investor sentiment will ultimately depend on execution. The critical question remains whether this expansion will successfully translate into a high-return business.
About the Author
Ananya Roy is the Founder of Credibull Capital, a SEBI-registered investment adviser focused on building disciplined, research-driven strategies for long-term wealth creation. A CFA charterholder with an MBA in Finance from a premier IIM and an engineering degree from NIT, she combines rigorous academic training with nearly 15 years of hands-on experience across the investment management spectrum. Her career spans index construction, portfolio management, and private equity investing, providing a comprehensive perspective on capital markets. Prior to founding Credibull Capital, she held key roles at Edelweiss, Reliance PMS, and Morningstar, where she contributed to fund management, equity research, and product development. This diverse background enables her to effectively bridge macroeconomic trends with bottom-up stock selection. Known for distilling complex financial concepts into actionable insights, she writes extensively on the economy, market dynamics, regulatory shifts, and personal finance, with contributions featured in Moneycontrol, The Economic Times, and Financial Express. Passionate about detailed industry analysis and fundamental research, she consistently seeks high-conviction opportunities guided by patience, discipline, and a sharp focus on risk-adjusted returns.
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