Dark horses of data centres: Lodha Developers and RailTel at the forefront of building infra for digital revolution 2.0

Blitz Bureau

NEW DELHI: Data centre capacity in India is projected to more than double to US$22 billion (around ₹2 lakh crore) by 2030, up from US$10 billion in 2025, according to property consultant Vestian. Vestian states that the sector attracted about $13-15 billion in investments between 2020 and 2024, of which 80 per cent came from foreign investors, according to a report written by Madhvendra for FE Online.

The Vestian report further states that the data centre investment pipeline remains robust at US$ 60-70 billion (about ₹6.5 lakh crore). Hyper-scalers drive a significant portion of this investment. Not just India, but the global data centre market capacity is also expected to more than double to 100 gigawatt (GW) by 2030, up from 40-50 GW at present.

The data centre sector in India is expected to benefit massively from the recent tax break. The Budget 2026 introduced a tax holiday until 2047 for foreign cloud service providers using Indian data centres, safe harbour provisions, and other incentives.

The report states that India’s data centre capacity could reach 4-5 GW by 2030, up from around 2 GW by the end of 2026.

Most of this data centre infrastructure remains concentrated in key metros, led by Mumbai, due to strong connectivity and infrastructure. Chennai acts as a global data gateway with multiple submarine cables, while Hyderabad, Bengaluru, and Pune are emerging as secondary hubs.

Against this backdrop, two companies have emerged as hidden gems with expanding presence in data centres.

First gem – Lodha Developers

Lodha Developers is one of India’s largest and most valuable real estate developers. It is known for premium, luxury, and mid-income residential developments. It holds a dominant 10 per cent market share in the Mumbai Metropolitan Region, and has also expanded into Pune, Bengaluru, and even Delhi NCR.

The group is transforming its Palava township into a major economic hub by developing one of India’s largest and most reliable data centre parks. This initiative is a strategic effort to accelerate value creation through land monetisation to build long-term recurring annuity income.

The Palava advantage

The planned data centre park at Palava is built on 400 acres of shovel-ready, contiguous land with all necessary approvals in place. It boasts infrastructure capable of supporting tier 4 data centres, which is the highest reliability standard globally. The site infrastructure aligns with the needs of data centres.

The park has 3 GW of available power, supplied through a highly reliable network comprising five circuits. Data centres require massive amounts of non-potable water for cooling.

Lodha has secured approximately 100 million liters per day of recycled water from a nearby industrial park to reduce costs and improve efficiency.

Global cost advantage

Thanks to the Maharashtra Government’s Green DC policy and the park’s efficient infrastructure, operators at Palava enjoy highly competitive economics and sustainability benefits.

Clients can see up to a 15 per cent reduction in capital expenditure. A turnkey shell data centre, which typically costs $8-12 million per megawatt globally, can be built in Palava for approximately $6 million.

Data center opportunity

Operating costs can be reduced by more than 30 per cent, bringing electricity costs down to $0.06 per kilowatt-hour (kWh), lower than $0.10–0.12 per kWh in the US. Operators can source 90 per cent of their energy from renewable sources, thereby mitigating the traditionally heavy environmental impact associated with data centres.

The site features five existing optical fiber routes, with the potential to scale up to ten. Lodha has already secured marquee global players as anchor clients, specifically Amazon Web Services and ST Telemedia, a Temasek subsidiary.

It expects additional hyper-scaler or colocation (colo) players to sign up over the next 12 to 18 months.
Lodha has also signed two Memorandums of Understanding with the Government of Maharashtra under its Green Integrated Data Centre Park Policy. This agreement facilitates a massive combined investment of ₹130,000 crore between Lodha and its clients. Lodha employs a dual strategy to monetise this opportunity.

Lodha’s ₹21 crore per acre land bank

The company has been monetising its surplus land by selling it to data centre operators. Even the infrastructure has seen value appreciation, with land prices growing eight-fold since 2021, from ₹2.6 crore to ₹21 crores per acre.

Lodha anticipates this land value to continue accelerating, targeting ₹50-60 crore per acre over the next few years.

In addition to outright land sales, Lodha is building dedicated teams to develop and lease powered shells (data centre buildings with cooling and power infrastructure, excluding servers) to global clients.
The developer expects this model to generate significant long-term rental income, with the cost to build these power shells estimated at roughly ₹30 lakh per megawatt, inclusive of land.

Revenue and PAT surge

From a financial perspective, revenue from operations rose by 25.2 per cent year-on-year to ₹11,960 crore by the third quarter of FY26. Pre-Sales grew 14 per cent to ₹14,640 crore, accounting for 70 per cent of FY26 pre-sales guidance.

Adjusted Ebitda (Earnings Before Interest, Tax, Depreciation and Amortisation) grew by 14.2 per cent to ₹4,000 crore, while net profit surged by 31.4 per cent to ₹2,420 crore.

Second gem- RailTel’s 102 nodes

RailTel Corporation is a Navratna public sector enterprise under the Ministry of Railways. It functions as a neutral telecom infrastructure and Information and Communication Technology provider in India.

The company’s operations are broadly categorised into two main segments: Telecom services and project work services.

Within the telecom services, the company leverages its pan-India network and multiple telecommunication licences to offer end-to-end managed data services. It offers a wide portfolio of managed and cloud services, including infrastructure as a service, platform as a service, software as a service, and co-location services.

RailTel operates tier-III-certified data centres in Gurugram and Secunderabad. It established its first tier-III data centre and launched DC services on a pan-India basis in FY14. The data centres are MeitY-empanelled, providing “RailCloud” for hybrid cloud solutions.

These facilities host mission-critical applications for public sector undertakings and government departments. They maintain highly reliable operations with a 99.9 per cent uptime service level agreement for cloud services and a 99.9 per cent uptime SLA for co-location services. Like Lodha, Railtel also offers 15 per cent energy saving using motion sensors.

Noida 10 MW powerhouse

RailTel is making significant investments to expand its data centre network in order to meet the growing demand for digital infrastructure. It is constructing a state-of-the-art 10 MW data centre in Noida. The first phase of this project, with a capacity of 5 MW, is expected to be ready between March and May 2027.

The company has partnered with Techno Electric & Engineering Company to develop edge data centers at 102 locations across India. Small-scale edge data centre operations are already active in Gurgaon and Mumbai.

Upcoming facilities in Chandigarh, Indore, and Vizag are expected to be operational by October 2026.

From RailCloud to Ethiopia

RailTel has also signed MoUs with private entities like Anant Raj, L&T, and TCS to jointly offer data centre colocation and managed services and drive business traction. In addition, the company is under active consideration for establishing a greenfield data centre for the Ministry of Foreign Affairs in Addis Ababa, Ethiopia.

From a financial perspective, revenue rose by 20.2 per cent year-on-year to ₹2,608 crore by the third quarter of FY26. Operating profit surged by 8.6 per cent to ₹403 crore, while margins stood at 15.5 per cent, down 160 basis points. Net Profit surged 9 per cent to ₹204 crore. The order book stood at ₹10,166 crore, providing about three years of revenue visibility as per FY25 revenue.

RailTel stands out with strong return on capital employed and return on equity, whereas Lodha, operating in the real estate sector, reflects more moderate return ratios.

Valuation-wise, Lodha trades in line with the industry multiple and at a discount to the five-year historical median. Railtel, on the other hand, is trading in line with historical multiples but premium to the industry.

India’s data centre market is projected to scale from $10 billion in 2025 to $22 billion by 2030, supported by a $60-70 billion investment pipeline and capacity expansion to 4-5 GW.

While the sector’s growth visibility is strong, the real differentiation lies in execution, where the ability to translate scale into consistent returns remains to be seen across players.