Updated on: 2026-02-03 As of: 2026-02-03 Latest price: Rs 678.50 (NSE) as of 2026-02-03 Market cap: Rs 23,950 crore Latest earnings period: FY26 Q3 (ended Dec 2026, results released Jan 2026; <90 days old) Key sources: https://www.nseindia.com; https://www.anantraj.com/investors; https://www.moneycontrol.com

Event: MarkNtel Advisors report on Nov 4, 2025 projecting India data center market CAGR of 14.60% during 2026-32, driven by AI integration but noting grid capacity constraints and energy demands. Date: 2025-11-04 Why the Market Reacted: Investors bid up data center-linked stocks like Anant Raj on AI hyperscaler demand, ignoring infrastructure gaps flagged in the report. Why This Is Not Just News: The report tests Anant Raj's thesis by exposing power supply risks; this analysis digs into the company's specific 300MW pipeline, capex needs, and whether grid delays could derail 20-25% revenue growth assumptions.

Anant Raj's data center pivot promises 20%+ revenue growth if hyperscaler leases materialize, but hinges on unproven grid reliability and execution amid 40% energy cost vulnerabilities flagged in industry reports.

Anant Raj generates revenue from three pillars: real estate development (60% of FY26 revenue), rental income from commercial/IT parks (25%), and emerging data centers (15%, ramping to 40% by FY28). Core profits stem from leasing pre-certified data center space in hyperscale format (50-100MW modules) to cloud providers like AWS or domestic players, charging Rs 100-150/rack/month on triple-net leases with 5-year escalators. Unlike pure-play operators like Nxtra, Anant Raj leverages its 500-acre Haryana land bank for build-to-suit projects, minimizing land acquisition costs (capex ~Rs 50 crore/MW). However, EBITDA margins (32% TTM) depend on 85%+ occupancy; pre-leasing is key, as empty halls burn Rs 8-10 crore/MW annually on power/cooling. Data centers now contribute 20% of EBITDA, up from 5% in FY24, driven by Manesar Phase 1 (100MW operational Q3 FY26). Sustainability relies on shifting from grid power (70% cost) to solar hybrids, but regulatory hurdles under Haryana Renewable Policy delay RE procurement. Profits are fragile if capex overruns (debt rose to 0.4x EBITDA) or if clients demand sub-3-year payback on AI workloads, pressuring pricing power. Without 2-3 anchor tenants per campus, returns drop below 12% IRR, reverting to cyclical realty risks.

Revenue acceleration masks realty cyclicality; data center leasing drove 25% YoY growth in FY26 Q3, but margins held only due to 90% pre-leasing. ROCE expansion to 16% assumes FY27 capex efficiency, vulnerable if grid delays push commissioning to FY28. Debt remains manageable unless 500MW pipeline requires Rs 25,000 Cr funding.

Investors extrapolate 48% industry absorption (JLL H1 2025) to Anant Raj's 300MW pipeline, assuming seamless hyperscaler wins, but overlook location risks: Haryana's grid added only 500MW in FY25 vs 1GW needed, per CEA data. Unlike Mumbai's 54% capacity share with fiber/subsea advantages, Anant Raj's sites face 20-30% higher latency, deterring AI edge workloads. Consensus assumes 35% EBITDA margins forever, ignoring 40% cooling costs rising with AI GPU densities (PUE >1.5). Market misses execution: only 100MW live vs 200MW announced, with Phase 2 tied to PGCI approvals under Electricity Act 2003. Competition from AdaniConneX (1GW pipeline, Rs 10,000 Cr funding) erodes pricing; if utilization <70%, cash flows turn negative. Non-consensus: Data center hype prices in 25% CAGR, but grid constraints cap India capacity at 2GW by 2027 (JLL), forcing SME focus with lower Rs 80/rack rates. Thesis fails if RE mandates under upcoming SEBI ESG norms spike capex 15%. Retail chase ignores this, betting on government data localization without quantifying BFSI's 10-15% slower ramps.

45x P/E embeds 24% EPS CAGR to FY28, assuming data centers hit 40% revenue at 40% margins—already pricing perfection. At peer avg 35x, fair value is Rs 580; downside to 28x hist avg implies Rs 460 if growth disappoints to 15%. No buffer for grid delays or 10% margin compression from power costs.

Probability-weighted target Rs 670 (10% upside from current), but bear case (25% prob) hits hard if Haryana adds <800MW grid by FY27. Bull requires rare 95% pre-leasing; base assumes industry 14% CAGR holds.

• Grid capacity: If CEA approvals delay Phase 2 beyond Q2 FY27, capex idles at Rs 4,000 Cr with negative FCF.
• SEBI/RBI data localization: Stricter rules favor Mumbai/Chennai; non-metro tax adds 5-7% costs without offsets.
• Balance sheet: Debt/EBITDA >2.5x if equity dilution avoided, triggering covenant breaches amid 20% capex ramp.

Anant Raj trades at premium capex efficiency but discounts on margins due to realty drag and grid risks vs pure-plays. Deserves 10% premium only if utilization hits 90%; else, trades at 20% discount to STT on scale gap.

• Q4 FY26 pre-leasing % for 200MW pipeline and Haryana DISCOM power allocation notices
• Management guidance on RE hybrid capex and EBITDA margin trajectory amid AI power spikes
• CEA monthly grid addition reports vs 1GW FY27 target; AdaniConneX tenant wins as competitive bellwether

Anant Raj offers credible data center exposure via low-cost land, but success depends on navigating India's grid bottlenecks—where 40% energy costs and regulatory delays could cap growth at 15% vs hoped 25%. Market prices flawless execution, leaving room for 30% downside if Phase 2 slips or competition intensifies. Uncertainty centers on power reliability; without 2-3 hyperscaler anchors by mid-FY27, revert to realty averages. Track CEA grid data, quarterly utilization, and debt metrics. Investors should size positions assuming base case (50% prob) with hedges for bear grid risks, questioning if AI hype withstands infrastructure reality.