October 26, 2025
Reliance Industries Ltd., led by billionaire Mukesh Ambani, is poised to invest an estimated $12 to $15 billion over the coming years in artificial intelligence infrastructure, a push that may include the development of a massive 1-gigawatt data center, according to a new report from Morgan Stanley.
The strategic move follows Ambani's announcement at the company's annual shareholder meeting in August, where he detailed a major foray into AI through a new subsidiary and key global partnerships.
The initiative will be spearheaded by a newly formed, wholly-owned subsidiary named Reliance Intelligence. The company's AI strategy is structured around four core pillars:
Infrastructure: Constructing gigawatt-scale, AI-ready data centers.
Partnerships: Collaborating with global technology leaders to introduce advanced AI solutions to India.
Services: Developing tailored AI-powered services for Indian consumers, small businesses, and major enterprises in sectors such as education, healthcare, and agriculture.
Talent: Investing in upskilling and nurturing India's AI workforce.
Morgan Stanley's report suggests that this AI deployment is set to redefine Reliance's equity narrative, a company known for reinventing itself every decade. The firm stated that generative AI enables large-scale capital deployment while creating synergies across Reliance's diverse verticals in energy, digital services, consumer retail, and media.
The investment breakdown estimates approximately $7 billion for data center infrastructure and $5 billion for the 250MW of AI chips the company plans to deploy directly. Reliance is expected to underwrite about 25% of the total 1GW capacity itself, with the remaining capacity to be leased to hyperscalers and large language model providers under a 'Datacenter as a Service' model.
The first phase of this ambitious project is already under construction in Jamnagar, Gujarat. Morgan Stanley indicated that Reliance plans to utilize an initial 100MW of Gen AI data center capacity, scaling up over two years, to meet enterprise inference demand. This effort will leverage its joint ventures and partnerships, including one with Meta on small language models, as well as collaborations with Google and Microsoft's Azure.
In a significant development this past Saturday, Reliance announced a dedicated AI joint venture with Meta's subsidiary, Facebook Overseas, Inc. The new entity, named Reliance Enterprise Intelligence Ltd (REIL), will see an initial investment of Rs 855 crore, with Reliance Intelligence holding a 70% stake and Facebook Overseas holding the remaining 30%. The venture aims to combine Meta's open-source Llama AI models with Reliance's extensive business network to create and distribute enterprise AI services for Indian companies.
Concurrently, Reliance is collaborating with Google to establish a dedicated cloud region in Jamnagar, merging Reliance's infrastructure with Google's AI and cloud technologies.
Morgan Stanley projects an approximate 11% return on capital employed (ROCE) on the initial AI investments. For the 'Datacenter as a Service' segment, it estimates annual revenues of around $1.5 to $1.6 million per MW.
The report also highlighted an energy synergy, noting that as data centers are significant power consumers, this initiative could underwrite over 20GW of internal power demand, thereby supporting Reliance's own goals of 100GW of solar panel capacity and 30-40GWh of battery manufacturing capacity.
SOURCE millenniumpost
