Embassy Industrial Parks, a JV between Embassy Group and Warburg Pincus, have made history by being the first-ever recipient of the World’s Greatest Brands & Leaders 2017-18 Asia GCC Award for the Logistics sector. In an exclusive interview, ADITYA VIRWANI, COO, EMBASSY GROUP speaks to CONSTRUCTION OPPORTUNITIES about the latest trends in the Indian Warehousing sector, innovations leveraged in the facilities, challenges involved and the future outlook on the industry.
Briefly give us an overview of the Indian Warehousing sector and the latest trends.
The year 2019 has started on a positive note for the Indian warehousing sector. Warehousing has been seeing steady growth since 2017, when the sector acquired infrastructure status. Easing of government regulations and structured reforms like implementation of GST, set up of a Logistics Department in the ministry of commerce and other policy changes have motivated further confidence in this segment. Growing manufacturing activity, rising domestic consumption, increasing international trade, emergence of organised retail in the country, increasing private and foreign investments in infrastructure along with the e-commerce boom will keep this robust development active for the next few years to come. 2018 witnessed a 22 per cent year-on-year growth in total stock in Grade A& B warehousing space in top eight cities while absorption saw a 60 per cent year on year growth in these markets. Delhi NCR, Mumbai, Pune, Bengaluru & Chennai emerged as the top 5 markets in terms of demand and absorption.
In line with the demand and requirements, built- to-suit developments like ours constituted for 26 per cent of the absorption last year. Apart from simply being conventional storing services, warehousing now provides many value-added services. Warehousing and logistics players are increasingly partnering in adopting modern solutions to handle inventory management, usage of fleet management software & RFID (radio frequency identification) systems. A strategically placed and well-planned warehouse not only improves the consumer services but also facilitates competitive advantage through efficient supply chain economics. At this rate, the current warehousing space is said to double in 3 years – 2022.