TCS, TPG join hands to build AI data center platform HyperVault, announce Rs 18,000 cr investment

Tata Consultancy Services (TCS) has announced a major strategic partnership with global alternative asset manager TPG to accelerate the growth of its AI-focused data center business, HyperVault. The collaboration marks a significant step in TCS’ ambition to become the world’s largest AI-led technology services company, as demand for high-performance computing and AI-ready infrastructure surges across industries.

Under the arrangement, HyperVault will be funded through a mix of equity and debt, with TCS and TPG together committing up to Rs 18,000 crore over the next few years. Of this, TPG will invest up to Rs 8,820 crore and is expected to hold between 27.5% and 49% equity in the venture. TCS said the partnership will reduce its capital outlay, enhance shareholder returns, and create long-term value for the data center platform.

TCS Chairman N. Chandrasekaran said the tie-up comes at a critical moment for the AI economy. “I am delighted to have TPG join us in our journey to build large GW-scale AI data centers in India, tapping the rapidly growing AI demand. With this capability, TCS is uniquely positioned to deliver complete AI solutions for its customers and partners,” he said.

TPG Executive Chairman Jim Coulter said data centers sit at the intersection of green energy, technology, and real estate. “We look forward to working with TCS to drive India’s next wave of digital infrastructure innovation in a climate-positive manner,” he noted.

HyperVault will develop purpose-built, liquid-cooled, high-density data centers designed to meet the needs of hyperscalers, AI companies, private enterprises, and the public sector. These facilities will provide compute power, storage, and low-latency networks required for real-time, large-scale AI model training and deployment. India’s data center capacity, currently around 1.5 GW, is projected to cross 10 GW by 2030, with nearly $94 billion invested in the sector since 2019.

TCS plans to work closely with hyperscalers and AI firms to design and optimize infrastructure for next-generation AI workloads, integrating its capabilities across cloud, AI platforms, IT services, and industry solutions. The transaction is subject to statutory approvals and customary closing conditions.

In October, TCS unveiled its ambitious plan to enter the data-centre market with up to 1 GW of capacity requiring over $6.5 billion in investment, and subsequently incorporated its wholly owned subsidiary, HyperVault Data Centers, on October 30. TCS was advised by AZB & Partners and Deloitte India, while TPG received legal counsel from Cyril Amarchand Mangaldas and Latham & Watkins, with tax advisory support from Price Waterhouse & Co.