STT GDC India to Invest $400M in Hyderabad Data Centre Campus

ST Telemedia Global Data Centre (STT GDC) is set to expand its portfolio in its biggest market, with digital infrastructure player’s India arm confirming plans to invest an estimated INR 3.5 billion ($400 million) to build a new data centre campus in Hyderabad.

The deal was announced after STT GDC India over the weekend signed a memorandum of understanding with the government of Telangana for development of its second location in the state capital. The new facility in Meerkhanpet, on the outskirts of Hyderabad, has a target capacity of 100 megawatts.

“This collaboration demonstrates our common goal of promoting economic expansion, generating employment and constructing a sustainable digital future. We are dedicated to contributing to Telangana’s status as a major global technology destination, and we count on the progressive leadership in Telangana to enable this journey,” ST Telemedia Global Data Centres president and group CEO Bruno Lopez said in a statement.

The agreement for the new Hyderabad data centre campus, which the local government describes as one of the largest in the city, is STT GDC India’s first expansion commitment since its parent group in September announced a plan to invest an estimated $3.2 billion in India.

Growing Indian Footprint

The expansion plan for STT GDC India, which was established through a partnership between the Temasek Holdings-backed Singapore firm and minority stakeholder Tata Communications, is set to be implemented over the next five years and would increase the joint venture’s 390-megawatt capacity in the country to 1 gigawatt.

The JV announced its Telangana deal after it entered a similar agreement with the government of Tamil Nadu in February 2024 to invest an estimated INR 19 billion to create an additional 80 megawatts of capacity in the state over the next four to six years.

Last month, STT GDC India signed a memorandum of understanding with Uttar Pradesh to help develop an AI City in the northern state.

STT GDC India – which has over 30 operational and under development data centres across 10 cities in the country – says it has a 28 percent share of the India market by revenue as of September 2024.

STT GDC India’s latest Hyderabad commitment adds to the growing supply of data centres in the country. In a November 2024 report, JLL said India’s data centre sector is expected to add 604 megawatts of capacity by 2026. This, according to the consultancy, will require 7.3 million square feet of real estate and capital investment of $3.8 billion.

In Expansion Mode

Closer to its home base, STT GDC has also been expanding its data centre capacity in Southeast Asia.

In May 2024, the company formed a joint venture with Vietnamese tech firm VNG Corporation to develop, construct, and operate nearly 70 megawatts of facilities in Ho Chi Minh City.

That deal followed its November 2023 announcement of plans to develop a facility of up to 120 megawatts in Johor, Malaysia as its second project in the city. In May of that year, STT GDC partnered with Philippine conglomerate Ayala Group for a $1 billion, 124-megawatt data centre campus in Metro Manila.

STT GDC’s expanding portfolio – which now spans 11 countries including the United Kingdom, Japan, Germany, and South Korea – has helped it attract fresh backing with KKR and Singapore telecom operator Singtel in June last year agreeing to invest up to $2.2 billion for a combined 18.3 percent stake in the company.