GST, Infrastructure Status Drive PE Investments in Warehousing

GST, Infrastructure Status Drive PE Investments in Warehousing

Government initiatives such as Make in India, implementation of the Goods & Services Tax and infrastructure status for the logistics sector have been pushing both demand for and investment in warehousing and industrial real estate across the country.

The infrastructure status to the logistics sector that includes industrial parks, cold chains and warehousing facilities has been helping in attracting private investments in these sectors.

While investors eyed opportunities in this sector in anticipation of the reforms to be implemented by the government, the flow of investment has gained further momentum now.

“Warehousing and logistics have emerged as one of the biggest growth areas in recent times. We have seen Rs 15,000 crore private equity investments in warehousing space since 2014. While it made up around 10% of total private equity investment in 2017, the share is now expected to grow further, claiming larger share of investment. India’s logistics and warehousing sector is rapidly transitioning through a revolutionary phase,” said Ramesh Nair, CEO and Country Head, JLL India.

According to Nair, India is set to see investments close to ?50,000 crore for creation of warehousing facilities across the country between 2018 and 2020. Various categories of warehousing are expected to create about 20,000 jobs during these three years at different levels of specification and specialisation. This investment comes on the back of the fact that nearly Rs 10,000 crore was invested in 2017.

Two major changes that sparked significant growth prospects in warehousing are the implementation of GST in India and creating a unified taxation, and the rapid growth of e-commerce necessitating building of large scale warehousing across various locations

With GST in place, the organized logistics industry is expected to catapult as the demand for integrated logistics services continues to rise. This underscores the increased appetite for investment among institutional investors in this segment. “We can clearly see increasing institutional participation in warehousing space. For funds and institutions with longer investment horizons, warehousing will be an excellent fit with regular yield income over the course of the next 5-6 years along with capital appreciation on account of increase in the underlying land values of urban infringes,” said Rubi Arya, vice chairperson, Milestone Capital Advisors.

Arya expects additional absorption of more than 200 million sq ft in this category by 2020, driven by growth in manufacturing and consumption in addition to GST implementation, infrastructure push and the rise of e-commerce.Last week, Singapore’s Ascendas-Singbridge Group and global investment company Temasek Holdings announced ?2,000 crore, or Singapore $400 million, to be invested in logistics and industrial real estate in key locations across India.Tapping into India’s growing logistics sector, the platform will invest in key warehousing and manufacturing hubs in Mumbai, NCR, Pune, Chennai, Bangalore, and Ahmedabad, among others.

The Economic Times, New Delhi, 11th May 2018

Credit card spending growth declines on RBI gaze, stress build-up

Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the...

SFBs should be vigilant, proactive to mitigate risks: RBI deputy guv

The Reserve Bank of India’s Deputy Governor Swaminathan J on Friday instructed the directors of small finance banks (SFBs) to be vigilant and proactive in identifying emerging risks in the sector.Speaking at a conference for directors on the boards of SFBs, Swaminathan highlighted the role of governance in guiding SFBs towards sustainable growth with stability. He also emphasised the importance of sustainable business models.Additionally, he highlighted the need for strengthening cybersecurity to protect the entities against digital threats and urged for a stronger focus on financial inclusion, customer service, and grievance redressal to ensure a broader reach of banking services.Executive Directors S C Murmu, Rohit Jain, and R L K Rao, along with other senior officials representing the Supervision, Regulation, and Enforcement Departments of the RBI, also participated in the conference. - Business Standard 30 th September, 2024

Brigade Hotel Ventures files draft papers with Sebi for Rs 900 crore IPO

Brigade Hotel Ventures Ltd, owner and developer of hotels in South India, has filed draft papers with capital markets regulator Sebi to raise Rs 900 crore through an initial public offering (IPO).The proposed IPO is entirely a fresh issue of equity shares with no Offer-for-Sale (OFS) component, according to the draft red herring prospectus (DRHP).Proceeds from the issue to the tune of Rs 481 crore will go towards payment of debt, Rs 412 crore will be allocated to the company and Rs 69 crore to its material subsidiary, SRP Prosperita Hotel Ventures Ltd.Additionally, Rs 107.52 crore will be used to purchase an undivided share of land from the Promoter, BEL, and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.The company may raise up to Rs 180 crore through a Pre-IPO Placement. If the placement is undertaken, the issue size will be reduced.Brigade Hotel Ventures Ltd is a wholly-owned subsidiary of Brigade Enterprises ...

CA Online

Search This Blog