There is a catch to India's big AI data centre boom

Data centre provider Yotta Data Services aims to launch an initial public offering (IPO) in January-March 2027, according to CEO Sunil Gupta, who spoke with Reuters. The Hiranandani Group-affiliated company is targeting up to $1.5 billion in funds, with plans to utilize the capital for debt repayment, acquiring graphics processing units (GPUs), and scaling sovereign cloud infrastructure to maintain data within national borders.

This move coincides with the surge in demand for AI computing infrastructure, as global tech behemoths such as Google and Amazon expand their presence in India.

Currently, Yotta is actively seeking pre-IPO capital, and the IPO portion is anticipated to be smaller than initially planned due to the achievement of most of its fundraising target, the CEO explained, although he declined to reveal specific revenue figures or the amount raised so far. Last month, Gupta announced via LinkedIn that Yotta had secured $150 million in primary growth capital at a valuation of approximately ₹37,000 ($3.9 billion).

The data centre operator emphasizes its role as India's largest provider of Nvidia-powered AI computing infrastructure. Gupta highlighted India's burgeoning attractiveness for AI infrastructure investment, citing power constraints, GPU shortages, and geopolitical tensions in the Middle East as factors driving this trend. He noted that global clients account for 75%-80% of Yotta's customer base.

Additionally, the company is exploring financing models under which partners would purchase GPUs through special-purpose vehicles, share the generated revenue, and subsequently transfer ownership to Yotta after a four-to-five-year period.