Published On:May 13 2021
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NxtGen eyes ₹400-cr investment across data centres.

NxtGen Infinite Datacenter, which is primarily into the cloud storage and computing segment, is eyeing investments to the tune of ₹400 crore across 10 data centres in India. The new units, which will be owned, operated and managed by the company, are likely to be operational by December this year.

Data centres are expected to come up in places such as Chennai, Hyderabad, Vizag and Jaipur. NxtGen currently has four large operating data centres – one each in Bengaluru, Ahmedabad, Mumbai and Delhi.

Industry experts say the data centre outsourcing market in the country is a $2-billion business and projected to grow at a CAGR of 25 per cent over the next few years. Data centres are measured either on the basis of the power that they consume or the volume of data that they store or process.

According to AS Rajgopal, MD and CEO, NxtGen Infinite Datacenter, at least two “smaller” data centres are expected to be operational over the next month and this is likely to be the pattern for the calendar year. Against a 1,000-odd rack capacity that the existing four larger ones have, the smaller centres will have a capacity of close to 200 racks.

Investments are currently being planned from own resources and if required additional debt could be raised. The company – backed by global investors like Intel, IFC and Iron Mountain – and with a turnover of nearly ₹240 crore has in March raised closed to ₹140 core through a debenture issue to Avenue Capital of the US. Funds will be used towards “infrastructure set up”.

“Today raising money from foreign players through debentures is a much cheaper funding option than going to Indian banks or looking at additional PE investments. Moreover, the data centre business is a stable-long term model which makes way for good investment opportunities here. We are already amongst the top three data centre players in India and with the 10 additional ones coming up, NxtGen will consolidate its presence,” Rajgopal told BusinessLine.

Amazon Web Services and Azure are the other two leading players in the country at the moment. Other major players include Yotta and NTT, among others.

Incidentally, in India, the Adanis announced investments of up to ₹70,000 crore to set up solar powered data parks in Andhra Pradesh; while Hiranandani Group announced a ₹14,000-crore investment plan in the segment.

Apart from Bengaluru and Noida, Hyderabad has been pushing for setting up of data centres.

Meanwhile, Rajgopal said NxtGen is considering listing on the bourses over the next two years. Discussions have begun.“Listing is a logical process for giving an exit route to some of the investors who hold majority in the company now,” he added.


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