US Data Centres Continue Buying Indian Transformers Despite Market Volatility as AI Power Demand Holds Strong

Indian transformer manufacturers are continuing to receive demand from US data-centre customers despite volatility in technology stocks and growing concerns about the sustainability of artificial intelligence infrastructure spending. Companies including CG Power and GE Vernova T&D India have reported no significant slowdown in orders from American customers, suggesting that investments in electricity infrastructure are continuing even as investors reassess valuations of AI-related businesses.

The resilience is important for India’s electrical equipment industry, which is benefiting from a global shortage of power transformers and rising electricity requirements from data centres. GE Vernova T&D India is discussing a potential $151 million supply contract for US data centres, while CG Power has already secured an export order worth approximately ₹900 crore from US-based Tallgrass. However, industry experts caution that some projects could experience delays if technology companies reconsider the pace of infrastructure investment.

US Data Centres Continue Ordering Transformers From India

The latest developments indicate that US demand for Indian-made transformers remains strong despite volatility in global technology markets.

GE Vernova T&D India CEO Sandeep Zanzaria said during the company’s October 30 earnings call that it had not seen signs of customers cancelling or reducing US data-centre orders.

Instead, some customers were requesting earlier deliveries as projects moved from planning into execution.

This is significant because transformers are among the critical components required to connect data centres to electricity networks. Large facilities need substantial and reliable power supplies to operate servers, cooling systems and other electrical infrastructure.

As AI workloads increase, data-centre developers are investing in larger facilities and additional computing capacity. This is creating demand for transformers, switchgear, substations and other equipment needed to deliver electricity reliably.

The continued ordering activity suggests that near-term stock market volatility has not yet translated into a broad slowdown in transformer procurement by the US customers of Indian manufacturers.

GE Vernova T&D India Discusses Potential $151 Million Contract

GE Vernova T&D India is in discussions to secure a contract worth approximately $151 million to supply transformers for US data centres.

The proposed deal represents another potential opportunity for Indian manufacturing operations to participate in the expansion of American AI infrastructure.

However, the contract has not yet been formally included in the company’s order backlog. It should therefore be treated as a potential business opportunity rather than a confirmed order.

The company has already indicated that its existing US data-centre customers are continuing with their procurement plans.

The distinction between discussions and confirmed orders is important when assessing future revenue. Transformer contracts often involve detailed technical specifications, manufacturing schedules and delivery commitments before they become part of a company’s reported order book.

If the proposed contract is secured, it could strengthen GE Vernova T&D India’s export pipeline and provide additional visibility into demand from the US power infrastructure market.

CG Power Secures ₹900 Crore US Data Centre Order

CG Power has also established a presence in the American data-centre transformer market.

Earlier in 2026, the company secured its largest-ever export order, valued at approximately ₹900 crore, from US-based Tallgrass Integrated Logistics Solutions.

The order involves supplying transformers for large-scale data-centre infrastructure.

During its October 23 analyst call, CG Power Global CEO and Managing Director Amar Kaul said that data centres would remain an important business segment despite concerns surrounding AI investment.

The contract demonstrates that Indian manufacturers can participate in specialised power infrastructure projects outside the domestic market.

For CG Power, the opportunity extends beyond a single customer. The company is expanding its international presence across the Americas, Europe and the Middle East and North Africa.

It is also maintaining exposure to other industrial markets, including renewable energy, oil and gas and electricity grid infrastructure.

This diversification can help reduce dependence on a single customer, geography or industry.

Why US Data Centres Need More Transformers

The expansion of artificial intelligence infrastructure is increasing electricity requirements across the United States.

AI data centres require large numbers of servers, specialised processors, cooling systems and supporting electrical equipment. These facilities consume considerably more electricity than many conventional commercial buildings.

Transformers are essential because they regulate voltage levels as electricity moves between power generation facilities, transmission networks, substations and data centres.

Without sufficient transformer capacity, developers may struggle to connect new facilities to the electricity grid even after completing other parts of construction.

The United States has already been dealing with a shortage of critical electrical equipment.

A Reuters report in July 2026 highlighted that transformer delivery times for some high-voltage equipment had extended beyond three years. The shortage has been driven by growing electricity demand, ageing grid infrastructure and supply-chain constraints.

For data-centre developers, this makes access to manufacturing capacity an important part of project planning.

Indian suppliers are positioned to benefit when American buyers seek additional manufacturing partners and alternative sources of electrical equipment.

AI Stock Volatility Has Not Yet Changed Infrastructure Demand

The latest optimism among Indian transformer manufacturers comes amid significant volatility in US technology stocks.

Investors have become more cautious about the amount of capital being committed to AI infrastructure and whether future revenues will justify the enormous spending by technology companies.

Political developments following the US midterm elections have also added uncertainty. Industry analysts have raised concerns that potential regulatory restrictions on data-centre construction could affect the speed of future investment.

However, industry experts distinguish between financial-market volatility and the long-term demand for electricity infrastructure.

Vinish Bawa, partner at PwC, said the long-term fundamentals of AI infrastructure remained strong, supported by growing AI adoption, increasing computing requirements and demand for reliable power and connectivity.

He also cautioned that project timelines could undergo periodic adjustments.

Tarun Pathak, research director at Counterpoint, said the real test for Indian suppliers would be whether US order inflows remained strong through 2027.

The distinction is important because a decline in technology stock prices does not automatically mean that companies will immediately cancel projects already under development.

Data-centre construction involves long planning cycles, equipment procurement and infrastructure commitments. Even if some projects are delayed, developers may continue placing orders for equipment required to meet existing construction schedules.

Indian Transformer Manufacturers Expand Into Global Markets

Indian manufacturers are increasingly looking beyond domestic demand to capture opportunities created by global electricity infrastructure investment.

Companies such as CG Power, Transformers & Rectifiers (India) and GE Vernova T&D India operate across several segments of the power equipment industry.

Their businesses include transformers for electricity transmission, renewable energy projects, industrial applications and data centres.

Geographical diversification is also becoming important. Manufacturers are expanding their presence in the Americas, Europe and the Middle East to access new customers and reduce dependence on a single market.

For Indian suppliers, the US offers an important opportunity because domestic American manufacturing capacity has struggled to keep pace with rising demand for large transformers.

However, exporting to the US also involves technical certification, customer qualification, logistics and after-sales service requirements.

Manufacturers must demonstrate that their equipment meets the electrical standards and operating requirements of American utilities and data-centre developers.

The ability to deliver equipment on schedule and maintain quality will determine how much of the available market Indian companies can capture.

Transformer Supply Constraints Could Support Indian Exporters

The shortage of transformers in the US has created opportunities for manufacturers outside the country.

A Reuters report in May 2026 highlighted that US demand for generator step-up transformers increased 274% between 2019 and 2025, while demand for substation power transformers rose 116%, according to Wood Mackenzie.

The report also identified rising transformer prices, longer delivery schedules and dependence on imports as important challenges for American power infrastructure developers.

These conditions create opportunities for suppliers in countries with established manufacturing capabilities.

Indian companies could benefit from this supply-demand imbalance, particularly if they can offer competitive pricing and reliable delivery schedules.

Nevertheless, the opportunity is not guaranteed. Manufacturers must manage raw material costs, factory capacity, labour availability and competition from established suppliers in other countries.

The Bigger Picture

The continued demand for Indian transformers highlights an important consequence of the global AI expansion: investment in artificial intelligence is creating opportunities far beyond semiconductor manufacturers and software companies.

Electricity infrastructure, transformers, transmission equipment and grid modernisation are becoming essential parts of the AI supply chain. Indian manufacturers are increasingly participating in this market through export contracts and discussions with international customers.

However, the long-term opportunity depends on whether AI infrastructure spending remains strong and whether manufacturers can convert potential contracts into confirmed orders and completed deliveries.

Looking Ahead

The next major indicator for Indian transformer manufacturers will be the strength of US order inflows through 2027. Investors and industry participants will monitor whether GE Vernova T&D India converts its proposed $151 million opportunity into a confirmed contract and whether CG Power secures additional international data-centre orders. Delivery schedules and order-book growth will be particularly important.

For the broader industry, the outlook will depend on electricity demand, AI infrastructure investment and the pace of transformer manufacturing expansion. Even if some data-centre projects are delayed, the need to modernise ageing power grids and connect new electricity-intensive facilities could sustain demand. Indian manufacturers will need to expand capacity, maintain quality and diversify their customer base to turn the current opportunity into long-term export growth.