Kotak Alternate Assets $800 million fund to invest in 5-7 data centres in India

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Kotak Alternate Assets, managed by Kotak Investment Advisors, will invest $800 million to support the development of five to seven large data centres in the key property markets of the country, The Economic Times has reported.

The Kotak Data Centre Fund will focus on investing in areas including Mumbai, Chennai, Noida and Hyderabad, which are witnessing a significant rise in demand for these services, the business daily said.

“Being a high capex industry requiring capacity build up, we believe that there is an equity investment opportunity to back partners in creating capacities. We will provide strategic risk capital and value-added support to our partners,” said Rahul Shah, executive director at Kotak Investment Advisors Ltd.

The Kotak Data Centre Fund will invest in building data centre capacity to support digital economy, enterprise cloud, 5G and IoT (internet of things). The fund is domiciled in Gujarat’s GIFT City.

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Shah said the data centre capacity in India was significantly lower than the fast-growing requirement. The fund would provide strategic risk capital to its partners and provide value-added support.

On February 14, the fund announced its first close worth over $590 million (nearly Rs 4,900 crore). The first close of the fund witnessed commitments from large institutional investors, including sovereign and pension funds, the report said.

Kotak Investment Advisors’ Kotak Special Situations Fund (KSSF) invested over Rs 1,000 crore in Sify Technologies subsidiary Sify Infinit Spaces in November 2021.

Set up in 2005, Kotak Investment Advisors Limited (KIAL) is the alternate assets management and investment advisory arm of the Kotak Mahindra Group.

It focuses on the alternate assets business and has, so far, raised, managed, and advised, in aggregate, over $7.5 billion across asset classes, including real estate, private equity, infrastructure, special situations fund, and investment advisory.