Sify data center unit is said to plan $500 million India IPO

The company, backed by Kotak Private Equity Group, is considering the sale of new and existing shares for the offering, which would value it at about $3 billion

Sify Technologies Ltd.’s data-center unit is preparing to submit a preliminary filing with the Indian regulator for an initial public offering that may fetch $500 million, according to people familiar with the matter.

Sify Infinit Spaces Ltd. plans to file a so-called draft red herring prospectus with the Securities and Exchange Board of India in the coming weeks, the people said, asking not to be identified because the information isn’t public. The company, backed by Kotak Private Equity Group, is considering the sale of new and existing shares for the offering, which would value it at about $3 billion, they said.

Deliberations are ongoing and the plan may change, they said.

Demand for data centers has been on the rise with the expansion of artificial intelligence, and India is no exception. The country’s data center capacity is poised to grow by 77% to 1.8 gigawatts in the next four years, according to a 2025 report by property consultant JLL.

Sify Infinit is one of India’s data-center pioneers, commissioning its first facility in 2000. It operates 14 data centers across India, offering about 188 megawatts of power, according to the company’s annual report.

The company has raised 16 billion rupees ($182 million) in two rounds from Kotak’s Special Situations Fund and Kotak Data Center Fund through compulsory convertible debentures, according to rating agency ICRA Ltd.

Kotak Mahindra Capital Co., Morgan Stanley, JPMorgan Chase & Co., Citic Securities Co. and JM Financial Ltd. have been appointed as bookrunners for the IPO, the people said.

Representatives for Sify and the banks didn’t respond to requests for comment.

Sify would be joining a growing list of companies tapping into the IPO market. Since January, Indian IPOs have raised over $8 billion, according to data compiled by Bloomberg. Jefferies Financial Group estimates that Indian companies will raise $18 billion in the second half of 2025.