NTT to invest $1.5 billion in India, to double capacity in 3 years
NTT that has integrated its three India units into one entity from this January, is focusing more on the data centre space where it leads the market, getting three-fourths of the committed $ 2 billion capex, which will see it nearly double the capacity to 2.5 million sqft, says a senior official of the Japanese technology services major.
NTT in India was created on January 1, 2021, by merging the three businesses –NTT India, NTT Communications India, and NTT-Netmagic under the leadership of Sharad Sanghi as the chief executive, following an announcement to this effect in last November.
NTT had also said announced a $2-billion capex to drive the data centres, networks and solar projects in the country over the next three years.
Before the new role, Sanghi was chief executive of Global Data Centres and Cloud Infrastructure India, known more as NTT-Netmagic.
NTT’s association with India began when in 2012 it bought a controlling stake in Netmagic, the country’s first independent data centre provider launched by Sanghi for a reported Rs 900 crore. Later in 2018 he fully exited the company selling the remaining 19 per cent stake to NTT.
Sanghi was the pioneer in the data centre space having set up the country’s maiden company in the space Netmagic way back in July 1998.
With over 1.5 million sqft across 10 data centres operational already in four cities, NTT is the largest operator in this segment and Sanghi says this will more than double to 2.5 million sqft over the next three years and will be entering four more cities.
Going forward our focus will be the data centre space. Accordingly, we’re launching six more data centre parks over the next three years. Of them, currently three parks are under construction in Mhape and Airoli (both Navi Mumbai) and Chandivali in Mumbai; and one each will be come up in Chennai, Delhi-NCR and Bengaluru.
This expansion will see up investing almost $1.5 billion of the committed $ 2 billion capex over the next three years, and will early double our capacity to over 2.5 million sqt from 1.5 million sqft now, Sanghi told in a weekend interaction.
The company is also keen to enter Hyderabad and Pune but will wait for demand to really firm up, he said.
NTT also runs the first and the largest operational hyperscale data center park in the country in Navi Mumbai.
Sanghi said the rest of the capex will go into power and managed services spaces. The renewal power sector will get the second biggest capex to the tune of $ 400 million to scale up our green power generation capacity 150 mw now and to 250 mw.
The remaining $100 million will go into building new undersea cable landing ports in Chennai, Mumbai and Khandala in Gujarat, he said.
Sanghi said the domestic data centre market is growing at an annual rate of 20 per cent and will continue to clip at this level for the next few years more. Currently, India is the fifth largest data centre market in the world that is led by China, but the India capacity is only a sixth of China’s.
Refusing to share any revenue figure, pointing to the fact that they are privately held, Sanghi said as of now, data centre business is the second largest in terms of revenue but has the highest margin and is also the fastest growing business for them, after the managed services business in the technology infra space, and the network unit the last.
But with after the expansion, data centre will be the biggest business unit both in term of topline as well as bottomline, he said.
NTT in India employs over 6,500, he said, and added that the business integration did not lead to any firing.