Data centre stocks in India have turned into the market’s favourite theme in 2026. Sterlite Technologies alone has rallied over 500% in one year, and I have been tracking it closely along with its old rival HFCL. The reason for this rally is so simple because according to a Data of statista, By mid-2026, global data creation has exploded beyond 200 zettabytes, driven by the massive expansion of artificial intelligence, high-density cloud clusters, and telecom 5G networks.
Now the interesting point is that both companies now sell the same story: fibre, connectivity, and data centres. But their businesses, numbers, and risk levels are very different. In this blog, I compare Sterlite Technologies and HFCL, so you can decide which one fits your portfolio better.
⚡ Quick Summary: Sterlite Technologies Vs HFCL
India’s data centre and AI infrastructure boom has turned both Sterlite Technologies and HFCL into investor favourites. While both companies benefit from rising demand for optical fibre, connectivity solutions, and hyperscale data centre networks, their growth drivers and risk profiles are quite different.
| Factor | HFCL | Sterlite Technologies |
|---|---|---|
| Risk Level | Moderate | High |
| Balance Sheet | Stronger | Higher Debt |
| Growth Driver | Defence + Telecom + Data Centres | AI & Global Data Centre Demand |
| Valuation | Relatively Lower | Premium Valuation |
| Best For | Balanced Growth Investors | Aggressive Growth Investors |
Bottom Line: HFCL offers a more diversified business with defence and telecom exposure, while Sterlite Technologies provides a higher-risk, higher-reward opportunity directly linked to the global AI, cloud, and hyperscale data centre expansion cycle.
Why Data Centre Stocks Are India’s Hottest Theme Right Now
AI is eating the world, and every AI model needs a data centre to run on. Globally, hyperscalers like Google, Microsoft, and Amazon are spending billions on new data centre capacity every quarter. India is not far behind. Our data centre capacity is expected to more than double by 2030, driven by cloud adoption, 5G, and government digital push.
This is why colocation data center players, hyperscale data center builders, and their suppliers are all in demand. Sterlite Technologies and HFCL don’t build data centers near me or you.
They make the fibre, cables, and connectivity products that go inside a colo data center. When a hyperscale data center comes up, these companies supply the nervous system that connects the data center servers. That is the real opportunity here.
Company Profile: Understanding the Core Business
To evaluate both contenders, we must first break down how each enterprise makes its money.
Sterlite Technologies (STL)
Sterlite Technologies is part of the Anil Agarwal-led Vedanta group, was founded in 1988 and is based in Pune. I like to call it India’s original fibre champion. STL designs and makes optical fibre cables, connectivity products, and digital network solutions for telecom players, cloud companies, and large enterprises across more than 100 countries.
In 2025, STL entered the AI-led data centre segment with a dedicated optical portfolio, and this single move changed the entire investor story around the stock. Today, data centre revenue is already a meaningful chunk of its business and growing fast every quarter. Its product lines directly serve the modern colocation data center and hyperscale data center ecosystems.
HFCL Limited
HFCL earlier called Himachal Futuristic Communications Limited, was incorporated in 1987 and is headquartered in Gurugram. Managing Director Mahendra Nahata has built HFCL into a four-engine company: telecom products, optical fibre cables, defence electronics, and turnkey EPC projects.
HFCL’s manufacturing units in Hyderabad, Goa, Manesar, Hosur, and Solan feed its telecom and defence clients. Its newer HTL data centre arm and export-focused optical fibre business are now driving the stock’s re-rating story in 2026.
Alongside standard optical fibre, HFCL produces high-margin active hardware equipment including Wi-Fi 7 access points, industrial 5G routers, and optic Ethernet switches.
Crucially, HFCL has built a formidable moat in defense electronics, securing orders for tactical communications, drone surveillance radars, and specialized optical cabling for Indian armed forces and railways.
Sterlite Technologies vs HFCL: Latest Financial Performance
Financial turnarounds tell a vivid story. Let us look at the latest reported consolidated figures (Q1 FY26) to see how both companies are executing operationally:
| Financial Metrics | Sterlite Technologies | HFCL |
| Revenue | ₹1,910–1,922 Cr | ₹1,915 Cr |
| Revenue growth | +31% QoQ | +120% YoY |
| Net Profit | ₹197 Cr | ₹245.6 Cr |
| Profit growth | +234% QoQ | Loss to profit |
| EBITDA Margin | ~13–15% | 23.25% |
| Order Book | ~₹18,600 Cr | ~₹26,665 Cr |
My Observation: HFCL’s margin recovery and order book size look stronger this quarter, but Sterlite’s data centre order pipeline is scaling faster on a percentage basis.
Sterlite Technologies vs HFCL: Latest Fundamentals
Valuation metrics highlight what the broader market is currently pricing into each business:
| Metrics | Sterlite technologies | HFCL |
| Market Cap | 36686 cr | 34691 cr |
| Current share price | 715 rupees | 219 rupees |
| PE | 150.92 | 57.38 |
| PB | 10.07 | 7.09 |
| EPS | 4.73 | 3.95 |
| Debt to Equity | 0.86 | 0.36 |
| ROE | 2.10 | 6.37 |
Note: The above data is as of September 03.
Data source: Groww
Both stocks look expensive on paper. This is a growth story priced for perfection, not a value buy. I always tell beginner investors to size positions carefully in stocks like these because a good company at a high price can give you bad returns.
Sterlite Technologies vs HFCL: Marquee Investors and Promoter Holding
| Ownership | Sterlite technologies | Hfcl |
| Promoter holding | 42.29% | 28.29% |
| FII | 19.71% | 15.74% |
| DII | 13.27% | 10.92% |
| Mutual Fund | 8.41% | 7.70% |
| Notable Investors | Bandhan Flexi Cap Fund, Motilal Oswal Mid Cap Fund | Quant Mutual Fund, Reliance Ventures |
Management’s Growth Plans
Sterlite Technologies: Sterlite’s management has bagged a large hyperscaler-linked order worth close to $1 billion, tied to US-based data centre demand.
Data centre revenue jumped from 16% of sales in FY26 to 21% in Q1 FY27. Managing Director Ankit Agarwal was reappointed for another five-year term, showing long-term commitment. Brokerage CLSA expects nearly 49% EBITDA CAGR ahead on this order alone.
HFCL: HFCL’s board raised its FY27 revenue growth target to 40%. It has approved a ₹215 crore investment for a new AI data centre connectivity manufacturing facility.
Fibre capacity is set to rise from 28 million to 38.5 million fkm by 2028. Management is also targeting defence revenue growth from ₹77 crore in FY26 to nearly ₹5,000 crore by FY29, per broker estimates. That is an aggressive, multi-engine growth plan.
Final Verdict
Here is how I allocate capital across both companies:
- Choose HFCL if: You prioritize balance sheet stability, low debt, consistent domestic order inflows, and exposure to the high-margin Indian defense electronics manufacturing boom.
- Choose Sterlite Technologies if: You are an aggressive growth investor looking for a pure-play global turnaround with immense operational leverage tied to the worldwide cloud and AI infrastructure boom.
⚠️ Cautionary note: These both stocks are not suitable for a conservative or low risk tolerance investor. So if you prefer a high risk-high reward stock for a 5-10 year timeframe, then Sterlite technologies can be a more explosive option over HFCL due to its 9% market leadership in optical fiber and advanced R&D.
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I am a pharmacist , investor, tech savvy and multi-niche content writer with over 5 years of experience and have served more than 15 organisations.
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