Black Box, Netweb and Blue Star: 3 Data Centre Stocks Compared

Black Box, Netweb Technologies and Blue Star are three listed companies with exposure to India's expanding data centre industry. Their businesses cover network infrastructure, high performance computing systems and cooling equipment, which are needed to build and operate data centres.

The companies have reported different growth trends over the past three years. Black Box has reported average annual sales growth of 4% and net profit growth of 41%, while Netweb Technologies has recorded sales growth of 67% and profit growth of 72%. Blue Star has reported sales growth of 25% and net profit growth of 52% over the same period.

India's data centre demand is being supported by rising data consumption, cloud adoption and the growing use of artificial intelligence (AI). However, the three companies have different business models, and their reported growth figures do not guarantee similar performance in the future.

Three smallcap data centre stocks and their financial performance

Black Box, Netweb Technologies and Blue Star have exposure to different parts of the data centre supply chain. Black Box works on networking and communication systems, Netweb supplies computing and storage infrastructure, while Blue Star provides air conditioning and cooling equipment.

The financial figures in the source cover the past three years, while some operational updates relate to the first half of FY26 and expectations for the rest of the financial year.

Company	Three year sales CAGR	Three year net profit CAGR	Average ROE	Average ROCE
Black Box	4%	41%	22%	29%
Netweb Technologies	67%	72%	31%	41%
Blue Star	25%	52%	22%	31%

Note: CAGR is the compound annual growth rate. ROE is return on equity, while ROCE is return on capital employed. The figures are based on the supplied source.

Netweb Technologies has reported the fastest sales and profit growth among the three companies in the period covered. Black Box has recorded slower sales growth but stronger profit growth, while Blue Star has reported growth across both measures. These figures provide a starting point for comparing the businesses, but they do not show their current valuations or future stock returns.

Black Box: Networking infrastructure and an $800 million order backlog

Black Box is a global information and communication technology solutions provider. Its business includes networking systems, IP telephony, video and voice communication, multimedia call centres, customer relationship management systems and unified communications.

The company serves more than 8,000 customers across several regions, including North America, the Middle East, Africa, Australia, New Zealand, Singapore, the Philippines and the UK. Its named customers include Bank of America, Wells Fargo, Meta, Amazon and Cleveland Hospital.

Black Box's three year sales CAGR stood at 4%, while its net profit CAGR was 41%. Its average ROE and ROCE were 22% and 29%, respectively, over the same period.

The company expected its order backlog to reach US$800 million in FY26, representing a projected year on year increase of 60%. An order backlog can provide an indication of potential future business, although the timing of execution and conversion into revenue remains important.

The company also faces supply constraints. Management cited shortages of fibre and related accessories, along with broader constraints affecting the data centre ecosystem. These issues could affect project execution and the pace at which orders are converted into revenue.

Netweb Technologies: AI systems and high performance computing

Netweb Technologies was incorporated in 1999 and supplies computer server solutions used in high performance computing (HPC), storage, deep learning, big data analytics, cloud computing and virtualisation.

The Faridabad headquartered company has development centres across India. It has also been involved in India's supercomputing programme, including the implementation of the Kabru supercomputer and PARAM YUVA II. The company participates in the National Supercomputing Mission and has installed more than 300 made in India HPC units. It also receives production linked incentive benefits in the IT hardware sector.

Netweb reported a three year sales CAGR of 67% and net profit CAGR of 72%. Its average ROE was 31%, while average ROCE stood at 41%.

H1 FY26 performance

Netweb's revenue grew 51.1% year on year in H1 FY26, supported by strong order inflows. Its EBITDA margin increased to 14.9% from 14.1% in the corresponding period a year earlier. The company attributed the improvement to operating leverage and a better business mix as its AI related operations expanded.

The AI segment's rising contribution to revenue points to the growing role of AI systems in the company's business. Its ongoing tie up with Nvidia is also expected to support revenue visibility in high performance AI systems.

However, the reported growth rates relate to specific periods. Investors tracking Netweb will need to examine subsequent revenue growth, order execution and margins to assess whether the pace can continue.

Blue Star: Cooling equipment for data centres

Blue Star was established in 1943 and operates in central air conditioning and commercial refrigeration. Its business also includes electromechanical projects, packaged air conditioning, professional electronics and industrial systems.

The company operates in more than 18 international markets across the Middle East, Africa and South Asia. It has also started expanding its international operations through new subsidiaries in North America and Europe.

Cooling is an important part of data centre infrastructure because servers generate heat and need systems that can maintain operating temperatures. Blue Star's air conditioning and refrigeration business therefore gives it exposure to data centre construction and expansion.

Blue Star's three year sales CAGR was 25%, while its net profit CAGR stood at 52%. Average ROE and ROCE were 22% and 31%, respectively.

In FY25, Blue Star expanded its data centre cooling portfolio with air cooled chillers in the 350TR to 550TR range. The company was also exploring multiple partnerships for liquid cooling in data centres under non disclosure agreements.

Management expected a strong fourth quarter in FY26. Its order book and market share were identified as factors that could support future growth, although the source does not provide a specific revenue contribution from data centre projects.

Why India's data centre industry is growing

India's data centre and cloud market is benefiting from rising digital activity and the growing volume of information generated by businesses and consumers. Data localisation requirements and government initiatives such as Digital India are also supporting demand for domestic infrastructure.

The adoption of AI, the Internet of Things and 5G is increasing the need for computing capacity, storage and reliable connectivity. Cloud service providers are expanding their infrastructure, while domestic businesses are moving more workloads to cloud platforms.

These developments create demand across several parts of the data centre supply chain. Netweb provides computing systems, Black Box supplies networking and communication solutions, and Blue Star provides cooling equipment. Their exposure to the same broad industry does not mean their earnings will respond in the same way.

Project delays, equipment shortages and changes in customer spending can affect suppliers differently. Companies may also face differences in order execution, margins and working capital requirements.

For wider market context, readers can also follow stocks where foreign investors increased stakes and the latest stock market gainers and losers.

What investors should watch

The three companies have different financial profiles and sources of data centre exposure. Their reported growth rates are historical figures, while some of the order and business updates are management expectations. Investors comparing the stocks can monitor the following developments:

• Black Box's progress in converting its expected $800 million FY26 order backlog into revenue, along with the effect of fibre supply constraints.
• Netweb Technologies' AI related revenue contribution, order inflows and ability to maintain its H1 FY26 margin level.
• Blue Star's execution of data centre cooling projects and progress on liquid cooling partnerships.
• Revenue growth, profit margins, working capital and valuations across all three companies.

The supplied figures do not include current share prices, market capitalisation or valuation multiples. A comparison of those measures would be needed to assess how much growth expectations are already reflected in each stock's price.

Frequently asked questions

Which are the three smallcap data centre stocks discussed in this article?

The three companies are Black Box, Netweb Technologies and Blue Star. Black Box is exposed to networking and communication infrastructure, Netweb Technologies supplies computing and storage systems, and Blue Star provides air conditioning and cooling equipment.

Which company reported the highest sales growth?

Netweb Technologies reported the highest three year sales CAGR at 67%. Its net profit CAGR was 72% over the same period, according to the supplied figures.

What is Black Box's expected order backlog for FY26?

Black Box expected its order backlog to reach US$800 million in FY26, implying 60% year on year growth. Management also cited shortages of fibre and related accessories that could affect project execution.

How fast did Netweb Technologies' revenue grow in H1 FY26?

Netweb Technologies' revenue grew 51.1% year on year in H1 FY26. Its EBITDA margin rose to 14.9% from 14.1% in the year ago period.

How is Blue Star connected to the data centre industry?

Blue Star supplies air conditioning and cooling equipment used in infrastructure such as data centres. In FY25, it expanded its chiller portfolio with air cooled models in the 350TR to 550TR range and was exploring liquid cooling partnerships.

What factors could affect these data centre stocks?

Order execution, revenue growth, margins, supply constraints and valuation can affect the three stocks. Black Box faces reported fibre supply constraints, Netweb's performance is linked partly to demand for computing and AI systems, and Blue Star's data centre exposure depends in part on cooling project demand and execution.