Avigna group to develop 5 million sqft of warehousing space in East, Northeast
Bullish about the warehousing potential of East and Northeast India, Avigna group is setting up 5 million sqft (MSF) of industrial warehouses across Patna, Kolkata, Guwahati and Siliguri at a cost of around Rs 1,000 crore. Its aim is to tap the growing demand for warehouses to cater to consumer durables, FMCG and pharmaceuticals.
The Bengaluru-based group has already launched such projects across south India, developing 10 MSF of warehousing space. It is also setting up a 2MSF facility in Bhiwandi (Thane). All the projects will be completed in phases.
“We are focusing on Tier-II cities as e-commerce surge has opened up these areas. Warehousing was growing at a CAGR of 5% before 2019, but now it’s 12-14% annually and can go to 18-20% in the coming years as enterprises have realised the value of an efficient supply chain network,” Avigna Group CEO Abhijit Verma told FE.
Sharing the company’s plans for eastern India, he said Patna and Guwahati are strategically located. While Guwahati is the gateway to the Northeast, the Patna warehouse will cover Bihar, Nepal, north of West Bengal and east of Uttar Pradesh. Both the cities have good road and air connectivity.
“In Patna, we are scouting for 50 acre land and intend to develop 1-1.25 MSF of warehousing space. In Guwahati and Siliguri we plan to build 3 MSF. This region has good potential for pharmaceuticals and supply chain for FMCG, consumer durables, etc. We are scouting for land in these areas. We are also looking for land parcels in Kolkata, where we will develop 1 MSF,” he added.
On finances, Verma said, “We start a project only when we have a client or at least the main client. This is an assurance that our investments are not going to lie idle. To build 1 MSF on an average up to Rs 200 crore is required. With clients already on board, financial institutions also feel safe lending to us. All these projects have clients and we are scouting for land together. We will finalise the land in FY21”.
Besides eastern India, Avigna group is also scouting for 60 acre land parcel for setting up warehouses in Farrukhnagar (Haryana), as well as 40 acres in Jaipur. It has tied up with clients in both cities. The company will set up build-to-suit (BTS) facilities in these locations.
In south India, Avigna has five locations, Verma said adding “First is Hosur (Tamil Nadu), we have 120 acre land with capacity to build 3 MSF. In Hoskote (Karnataka), we have 130-140 acres and are looking to develop 3-4 MSF of warehousing space. In Chennai, we have 40 acres and plan to develop 1 MSF. In Madurai, we will be developing 2 MSF, and in Nellore (Andhra Pradesh) 1 MSF”.
Of this, the company will deliver 1 MSF in Hosur by the end of this fiscal. In FY23, it plans to hand over 2 MSF in Hosur, 1 MSF in Hoskote and 1 MSF in Madurai.