Hiranandani to invest Rs 30,000 crore in its data center unit

Hiranandani group is all set to double up on its investment plans for its data center unit Yotta. The two-year old venture has not only set up India’s first Tier IV data center in less than a year’s time at Mumbai but is already starting to replicate the initial success in other cities as well.

Sunil Gupta, CEO, Yotta, said, “The demand has been overwhelming for our first data center in Mumbai. Being the only Tier IV certified data center has also played a big role in this. It gives us more confidence to expand at an even more rapid pace. One building of the size we are making costs us about Rs 1,200 crore. We are making five such in Mumbai, six in Noida, six in Chennai, three in Pune, three in Calcutta and one in Gujarat. Idea is to start the first building as a risk investment and then rapidly scale from there. Overall the investment could well surpass Rs 30,000 crore over the next 5 years.”

The Indian data center market would require $3.7 billion over the next three years to meet the industry requirement for six million sq ft of development, according to a report by JLL India. The report highlights that in 2020, the Indian data center industry saw a record 102 MW absorption, the second-highest compared to key markets in Europe and the Americas.

“Large cloud players are increasing their presence in the world’s second-largest user market. At the same time, the advent of the pandemic has prompted a faster shift to colocation from the traditional captive IT infrastructure,” the report says.

According to Gupta, the biggest growth is coming from the shift towards digitization that’s being observed since the beginning of Covid-19 in early 2020. “The growth was already quite phenomenal pre-Covid but Covid has fuelled the demand for cloud services manifold leading to a massive growth in demand for data center space,” Gupta explained. Some of the biggest customers for Yotta are hyperscalers who are eyeing not just a few racks or a floor but entire data center buildings in one go, Gupta said.

Hyperscalers is a term used for large cloud services players such as AWS, Google, Microsoft Azure and IBM.

Yotta is banking on parent Hiranandani group for acquisition of land for setting up large data center parks in various parts of the country instead of picking space for one data center at a time. Gupta says that allows the company to set up its captive power stations for providing backup power and the negotiating power that is necessary in the highly competitive market