Target: ₹1,080
CMP: €737.85
We believe that Anant Raj’s (ARCP) entry into cloud business could be a turning point for the company as it looks to move further up the chain of its core colocation business in the vertical data center sector. While investment intensity increases in this model, the revenue potential is many times that of colocation (ARCP guidelines for colocation – ₹10 crore/MW, cloud – ₹150 crore/MW).
The success of the 0.5 MW cloud pilot paves the way for ARCP to further expand capacity, in partnership with Orange Business, a global system integrator. Global public cloud spending reached $632 billion in CY23 and is expected to grow at a CAGR of 19 percent through CY29. India’s public cloud spend is expected to grow from $8 billion in CY23 to $30 billion in CY29, at a CAGR of 25 percent.
We believe the TAM for ARCP is substantial, especially in a market dominated by global cloud providers as governments and enterprises move toward data localization and sovereignty. We have integrated the valuation of cloud companies and revised the valuation of residential projects, taking into account greater visibility over projects post-FY30, driven by the addition of plots; our TP increases to ₹1,080 (from ₹620.
