Real estate player Hiranandani Group is poised to double its investment plans for its data center unit Yotta, where the company expects windfalls. 

The two-year-old company has not only set up India’s first Tier IV data center in Mumbai in less than a year, but is also starting to replicate its initial success in other cities.

“Demand for our first data center in Mumbai was overwhelming. As the only Tier IV certified data center, it has also played a major role in this. It gives us more confidence to expand at an even faster pace,” Yotta CEO Sunil Gupta told ETCIO.

“A building of the size we make will cost us about Rs 1,200 crore. We are making five in Mumbai, six in Noida, six in Chennai, three in Pune, three in Calcutta and one in Gujarat. The idea is to start the first building as a risk investment and quickly scale up from there. Overall, the investment could exceed Rs 30,000 crore in the next 5 years,” Gupta said.

When it was founded in 2019, Hiranandani had considered an investment of Rs 15,000 crore for a period of 5-7 years to scale up Yotta. However, within two years of incorporation, the company doubles all of its investment plans.

According to a report by JLL India, the Indian data center market would need $3.7 billion over the next three years to meet the industry need for six million square feet of development. The report highlights that India’s data center industry saw a record 102 MW take-up in 2020, the second highest when compared to key markets in Europe and America.

“Major cloud players are increasing their presence in the world’s second largest user market. At the same time, the advent of the pandemic has accelerated the shift towards colocation of traditional captive IT infrastructure,” the report said.

According to Gupta, the biggest growth has come from the shift to digitization seen since the onset of Covid-19 in early 2020. a huge growth in the demand for data center space,” explains Gupta. Some of the biggest customers for Yotta are hyperscalers that look not just at a few racks or a floor, but entire data center buildings at once, Gupta said.

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

“Delhi was not in the original plan, but we have already commissioned an entire building by a customer before it is even in use. The government of UP has been very helpful in terms of approvals etc. Today we are building our first data center in UP but we bought enough land there to scale it up to 6 data centers there. To support that, we are also building a 300 MW substation that is enough for 6 data centers there,” said Gupta.

Yotta is counting on parent group Hiranandani to purchase land to set up large data center parks in different parts of the country instead of choosing space for one data center at a time. Gupta says this will allow the company to set up its own power plants to provide backup power and the bargaining power needed in the highly competitive market