Sify Infinit Spaces has encountered a significant valuation challenge in its proposed initial public offering, with investors offering substantially less than the company's asking price. According to reports from The Economic Times, the data centre operator is seeking a valuation of ₹40,000 crore while investors have remained unwilling to pay beyond ₹22,000-25,000 crore since April. This substantial gap has led to the company's silence in recent months and may result in a delayed market debut.
The valuation challenge reflects broader market conditions affecting India's primary market this year. As reported by The Economic Times, institutional investors have become more selective, with companies cutting issue sizes, accepting lower valuations, or delaying IPOs altogether. Bankers are also seeking to leave more value on the table for public market investors to avoid sharp corrections in share prices after listing, particularly given weaker secondary market conditions. The absence of relevant local benchmarks has complicated the valuation process, with the recent listing of ESDS Software Solutions at around ₹5,000 crore adding another dimension to the valuation debate.
Sify Infinit Spaces demonstrated strong financial growth in FY25, according to company data reported by The Economic Times. The company reported revenue of ₹1,428.4 crore in FY25, representing a 28.2% increase from ₹1,114.2 crore in FY24. EBITDA rose to ₹634.2 crore from ₹465.3 crore, while profit after tax increased to ₹126.4 crore from ₹93.2 crore. The company secured SEBI approval in January for its public offering and is the data centre subsidiary of Sify Technologies, with major investment banks serving as book running lead managers.
Despite the current valuation challenges, India's data centre industry is positioned for significant expansion. As reported by The Economic Times, approximately $400 billion of capital has been committed by global hyperscalers and Indian conglomerates, with India's DC capacity expected to grow from 1.6 Gigawatt to 10 Gigawatt in seven years. Meanwhile, the US alone is expected to grow from 31 Gigawatt to 84 Gigawatt by 2030. However, investors remain cautious about translating this opportunity into sustainable returns, particularly as concerns around global AI spending and valuations have intensified.
