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India data centres may see $23bn investments by 2033: Avendus
Summary
India data centres will be the largest segment of real assets investments with an expected compounded annual growth rate of 40% to reach 1,700 MW capacity by 2025, which will be on the back of investments worth $5 billion coming into the sector, Avendus report
NEW DELHI : India may see investments of up to $23 billion for capex on data centres as an infrastructure asset over the next 10 years, driven by the exponential increase in data consumption, storage, governmental thrust on data localisation and the need for high bandwidth, following the launch of 5G.
According to a report from investment banking firm Avendus Capital, shared with Mint, data centres will be the largest segment of real assets investments with an expected compounded annual growth rate of 40% to reach 1,700 MW capacity by 2025, which will be on the back of investments worth $5 billion coming into the sector. Developers expect demand to be over 3,000 MW, nearly quadruple the 800 MW installed capacity in 2022.
Prateek Jhawar, managing director and head, infrastructure and real assets investment banking, Avendus Capital, said the firm was bullish about the growth opportunity India provided in the segment.
“Global investors are most likely to partner with domestic players, owing to their access to land banks, ability to procure regulatory approvals, as well as their civil, mechanical and electrical fit-out capabilities. We expect real estate developers and investors to evaluate the option of converting their underlying portfolio into REITs, creating perpetual yield income, much like their global counterparts," he said.
