The valuation of Infratil’s 48 per cent stake in CDC Data Centres has been hiked again – this time by A$448 million ($467m).

Infratil has also revealed yet another increase to CDC’s construction ambitions in
Auckland, where it recently completed “hyperscale” data centres in Hobsonville and Silverdale.

Infratil bought its CDC holding for A$392m in 2016. It has been revalued upwards every six months since as demand for cloud computing has boomed, and CDC has steadily added to its capacity (measured in the amount of power, in megawatts, that a data centre consumes at its peak consumption).

Infratil says its CDC stake is now independently valued at A$3.64 billion to A$4.19b (with a midpoint of A$3.88b), up from A$3.155b to A$3.74b (with a midpoint of A$3.44b) at the end of March – a 13 per cent increase, based on the midpoints.

The upgrade consolidates CDC’s position as Infratil’s most valuable holding by some margin (the second is One NZ; Infratil took full control of the telco in June at a $1.8b valuation).

Expansion plans expanded

CDC’s Hobsonville and Silverdale data centres were each rated at 14MW as they opened in November last year – or a combined 28MW.

Infratil had already revealed CDC has another 30MW of capacity under construction in Auckland, and a further 70MW in “Auckland future build”.

Today, Infratil bumped its “Auckland future build” ambitions to 81MW.

Investor relations manager Mark Flesher told the Herald there was no timeline for the future builds, at this point.

All up, CDC now has 517MW of total capacity across Melbourne, Sydney and Auckland, and a total of 517MW planned.

Infratil shares were up 0.50 per cent to $10.10 in early trading, while the NZX50 was down 0.43 per cent.

The stock is up 19.2 per cent for the year.

Forsyth Barr has an outperform rating, with a target price of $11.90.

While multiple players building hyper-scale data centres in Northwest Auckland, from ASX-listed NextDC to Amazon and sometimes CDC partner Microsoft, ForBarr sees trends in cloud computing, AI and data nationalisation continuing to drive growth.

ForBarr also sees another major Infratil holding, OneNZ, riding the cloud computing boom.

It said this was likely in collaboration with CDC to deliver public cloud solutions to its customers at attractive prices relative to Spark’s current private cloud.

The situation is nuanced, with Spark expanding its private, public and hybrid cloud offerings by boosting its own data centre capacity and working with multi-nationals, including Google and AWS.

Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.