In a move that underscores how quickly artificial intelligence is reshaping digital infrastructure, Tata Consultancy Services (TCS) has announced a large-scale partnership with global investment firm TPG. Together, the two companies plan to pump nearly ₹18,000 crore into expanding TCS’s newly created AI-focused data centre business, HyperVault.
This collaboration brings significant financial muscle as well as deep industry experience at a time when organisations worldwide are scrambling to secure high-performance computing capacity for AI workloads.
Building HyperVault Into an AI Powerhouse
Under the terms of the arrangement, TPG is expected to invest up to ₹8,820 crore, while TCS will contribute the remainder to retain a slight majority stake. The funding will come through a mix of equity, convertible preference shares and structured debt, and will be released in stages as regulatory and commercial conditions are met. Depending on the final phasing of the investment, TPG’s ownership in HyperVault could range between 27.5% and 49%.
HyperVault is designed to address a major gap in India’s digital backbone: the lack of domestic, AI-ready, high-density computing infrastructure. These new hyperscale facilities are expected to use liquid cooling and other advanced technologies that traditional data centres weren’t built to support. The focus will be on serving hyperscalers, AI-first companies and large enterprises that want locally hosted, high-performance compute environments.
Why This Partnership Matters Now
AI-driven computing needs are growing exponentially, and India’s current data centre capacity of roughly 1.2–1.5 GW is nowhere close to meeting the demands projected over the next five to six years. Some industry estimates expect requirements to rise almost ten times, especially as businesses move more regulatory-bound, sensitive and AI-heavy workloads onshore.
TCS has already indicated that every 150 MW addition to capacity may cost close to $1 billion to build, and may take 18–24 months before it starts generating steady revenues. HyperVault’s model is built around long-term, annuity-style income streams, making it attractive for institutional investors who prioritise stable cash flows.
Voices From the Leadership
TCS Chairman N. Chandrasekaran said the partnership with TPG builds on the company’s ambition to become a global leader in AI infrastructure. According to him, scaling up HyperVault will not only strengthen TCS’s capabilities in the AI era but also deepen ties with hyperscalers and global AI players.
TPG, meanwhile, is participating through its TPG Rise Climate fund, its Global South Initiative, and its Asia-focused real estate platform—reflecting the multi-disciplinary nature of data centre investments, which sit at the intersection of sustainability, technology and infrastructure.
TPG Executive Chairman Jim Coulter highlighted that future data infrastructure must balance performance with environmental responsibility and that the firm aims to help India build a resilient, climate-positive digital ecosystem.
Strengthening India’s Digital Ambition
As more organisations and regulators insist that data and compute remain within national borders, India’s need for sovereign, AI-grade infrastructure has never been more evident. HyperVault positions TCS to address this demand while contributing to India’s broader digital transformation goals.
The deal has also seen participation from several top advisory firms: AZB & Partners and Deloitte supported TCS, while TPG received counsel from Cyril Amarchand Mangaldas, Latham & Watkins, and Price Waterhouse & Co.
A Strategic Boost at a Critical Moment
For TCS, this partnership delivers both the capital and expert backing needed to scale rapidly in one of the most critical technology arenas of the next decade. With AI compute requirements altering the economics and environmental demands of data centres worldwide, the TCS–TPG alliance offers a timely and strategic advantage as India races to build next-generation digital infrastructure.
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