TCS shares rise on teaming up with TPG Terabyte to invest ₹18,000 crore in AI data center arm HyperVault

This comes after entered into a securities subscription agreement and shareholders’ agreement with TPG Terabyte to support the growth of its AI data center business, HyperVault, via a combined investment of ₹18,000 crore.

The stock was trading 0.13% higher at ₹3,149 per equity share, as of 9:50 am.

Under the strategic partnership, HyperVault will be funded through a mix of equity from TCS and TPG in a ratio of 51:49, and debt, as stated in a regulatory filing on Thursday.

Out of the total commitment, TPG will invest up to ₹8,820 crore and is expected to have a final shareholding between 27.5% and 49% in HyperVault, it added.

TCS’s AI data centre subsidiary will thus issue shares and compulsorily convertible preference shares to the two firms in multiple tranches over the next few years.

As per the agreements, the investment will have a lock-in period of three years, during which neither of the two companies will transfer any securities directly or indirectly, except to affiliates.

Furthermore, TCS will have the right to appoint the majority of the directors of HyperVault’s board, with TPG being able to appoint two directors.

“Bringing in TPG as a strategic investment partner will help TCS drive stronger returns to its shareholders, reduce its capital outlay, and create long-term value for the data center platform,” the IT company said.

This investment will support HyperVault’s GW-scale AI-ready infrastructure build and aligns with TCS’ plan to create AI-ready data centers with capacity in excess of a GW over the next few years, it added.

Commenting on the partnership, N. Chandrasekaran, Chairman, TCS, said: “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. It will further strengthen our partnership with hyperscalers and AI companies. With this capability, TCS is uniquely positioned to deliver complete AI solutions for its customers and partners.”

TPG’s investment in HyperVault will be facilitated through TPG Rise Climate and its Global South Initiative, a private equity strategy launched in partnership with ALTÉRRA. Additionally, TPG is also partnering via its Asia Real Estate business.

“We are excited to partner with TCS and are grateful for our long-standing partnership with the Tata Group, both of which share our vision and commitment to innovation and sustainability. Data centers are a multifaceted asset class and sit at the intersection of green energy infrastructure, technology, and real estate,” said Jim Coulter, Executive Chairman of TPG and a Managing Partner of TPG Rise Climate.

The IT major has a total market capitalisation of ₹11.37 lakh crore, as of November 21, 2025, according to data on the NSE.