Data centre specialist GDS tipped to accelerate expansion to meet growing demand from major internet firms
Firm expected to invest additional 1.7bn yuan to ramp up new developments, after forking out 472.3m yuan on current batch of high-performance centres now under construction
Driven by booming demand from China’s three major internet services companies, Shanghai-based data centre operator GDS Holdings is accelerating its infrastructure expansion to more than double its capacity on the mainland by 2018, according to Citi Research analyst Cher Chen, in a new report.
“We expect GDS to expand capacity by a 37 per cent compound annual growth rate in the next two years, from 63,000 square metres to 119,000 sq m in 2018,” Chen said.
Shares in Nasdaq-traded GDS slipped 0.52 per cent to reach US$9.56 at the close of trading on Thursday in the United States.
The company, which raised US$200.7 million from its initial public offering last month in the US, estimated that it has spent 472.3 million yuan on its current batch of so-called high-performance data centres under construction, and expected to invest an additional 1.7 billion yuan to ramp up and complete these new developments.
Data centres are secure, temperature-controlled facilities built to house large-capacity servers and data storage systems, as well as equipped with multiple power sources and high-bandwidth internet connections.
These are largely used to host and manage cloud computing operations. Cloud services enable companies to buy, lease or sell software and other digital resources online, just like electricity from a power grid.