Nvidia Q1 Results Boost Indian Data Center Stocks: Anant Raj and Netweb Shine

Nvidia’s stellar Q1 performance has once again sent ripples through the global stock markets, and Indian data center-related stocks like Anant Raj and Netweb Technologies are riding the wave. According to a recent Moneycontrol report, these stocks surged by up to 3% following Nvidia’s impressive earnings, highlighting the growing influence of the AI and data center boom on Indian markets. Let’s dive into what this means for investors and why these companies are worth watching.

Nvidia’s Q1 Results: A Catalyst for Growth

Nvidia, a global leader in AI and semiconductor technology, reported a blockbuster Q1 with revenues reaching $44 billion, a 69% year-over-year increase, driven primarily by its data center segment, which contributed $39.1 billion, up 73% from last year. The company’s earnings per share (EPS) of $0.81 also surpassed expectations, sparking a 6% jump in its stock price in extended trading. This performance underscores Nvidia’s dominance in the AI chip market, with its data center revenue alone growing 427% over five years, from $0.6 billion in Q1 FY20 to $22.6 billion in Q1 FY25.

The ripple effect of Nvidia’s success was felt worldwide, including in India, where companies tied to data center infrastructure saw a boost. The demand for AI chips and data center solutions is skyrocketing, and Indian firms are positioning themselves to capitalize on this trend.

Anant Raj and Netweb Technologies: Riding the AI Wave

Anant Raj Ltd., a real estate and data center infrastructure company, saw its stock rise by up to 3% following Nvidia’s results. The company has been making strides in the data center space, capitalizing on the growing need for AI-driven computing facilities. Despite a sharp sell-off earlier in January 2025 due to concerns over competition from Chinese AI startup DeepSeek, Anant Raj has shown resilience. The company reported a 55% jump in net profit for Q3 FY25, reaching ₹110.3 crore, and a 51.5% profit increase in Q4 FY25, with sales crossing ₹500 crore. Anant Raj’s management has stated that advancements like DeepSeek will drive demand for more data centers, positioning the company for growth.

Netweb Technologies India Ltd., a key player in high-performance computing and an OEM partner of Nvidia, also saw its shares climb by up to 3%. The company’s stock surged 18% intraday on May 5, 2025, after reporting a 45% increase in Q4 FY25 net profit to ₹42.99 crore and recommending a ₹2.50 per share dividend. Despite a 44% drop in its stock price in 2025, Netweb’s long-term growth potential remains strong, with its share price rising 233% from ₹898 in July 2023 to a peak of ₹3,060 in December 2024. Analysts, such as those from Equirus, have set a target price of ₹2,655, citing consistent high growth and strong return ratios.

Why Data Center Stocks Are in the Spotlight

The global AI revolution is fueling unprecedented demand for data centers, which require robust infrastructure, high-performance computing solutions, and energy-efficient systems. Nvidia’s success highlights the critical role of AI chips in this ecosystem, and companies like Anant Raj and Netweb are well-positioned to benefit. Anant Raj provides the physical infrastructure for data centers, while Netweb supplies the computing solutions, including servers for AI, deep learning, and big data analytics.

However, these stocks have faced volatility. Both Anant Raj and Netweb experienced significant corrections earlier in 2025, with declines of up to 50% from their 52-week highs, triggered by fears over DeepSeek’s low-cost AI model disrupting the market. Despite this, both companies have rebounded, with Anant Raj stating that decentralized AI processing will increase data center demand, and Netweb viewing DeepSeek as an opportunity for market expansion.

Should You Invest?

For investors, the recent surge in Anant Raj and Netweb Technologies presents an intriguing opportunity, but caution is warranted. While both companies are aligned with the AI and data center megatrend, their valuations remain high. Netweb, for instance, trades at a price-to-earnings (P/E) multiple of 92x, though this is lower than its 20-month median of 145x. Anant Raj, with its dual focus on real estate and data centers, has seen its stock soar 190% in 2024, but it’s still 32% below its recent peak.

The broader market context also matters. Indian markets have been volatile, with the Nifty50 recently surpassing 25,000 but also dipping below 24,600 in May 2025. Global factors, such as trade policies and economic slowdown fears, could impact sentiment. However, Nvidia’s strong outlook and the growing AI infrastructure demand provide a positive backdrop for data center stocks.

Looking Ahead

As AI adoption accelerates, companies like Anant Raj and Netweb Technologies are poised to play a critical role in India’s tech ecosystem. Nvidia’s Q1 results are a reminder of the massive potential in this sector, and Indian firms are stepping up to meet the demand. For investors, these stocks offer exposure to a high-growth industry, but thorough research and a long-term perspective are essential given the market’s volatility.

Stay tuned to kishanbaraiya.com for more insights on market trends and investment opportunities!