India's Warehousing and Cold Chain Market Surge Signals Lucrative Opportunities for Investors

MUMBAI, India - April 4, 2024 - PRLog -- In 2023, India spearheaded the expansion of the warehousing and cold chain markets across the Asia Pacific region, with an anticipated addition of over 30 million square meters. This growth surge, primarily propelled by key cities such as Bengaluru, Delhi-NCR, and Mumbai, underscores India's pivotal role in the global supply chain landscape. The remarkable growth trajectory witnessed in 2023 also resulted in a surge in rental rates, highlighting the sector's significance in both domestic and regional dynamics.

India's Industrial
and Logistics Sector and Economic Ambitions
India's ambition to achieve a USD 5 trillion economy by FY25 heavily relies on the Warehousing, Industrial, and Logistics (WIL) sector. This sector, particularly the warehouse and logistics industry, has experienced notable growth, largely influenced by the COVID-19 pandemic. Projections suggest a significant transition towards smart warehouses, with nearly 40% of organized warehouses expected to adopt smart technologies by 2030.

Emergence as a Global Cold Chain Hub
India's potential as a global cold chain hub has become increasingly evident, especially in recent years. The onset of the pandemic further accelerated this trend, leading to a remarkable surge in the country's cold chain sector. This growth is fueled by rising demand, especially in sectors like pharmaceuticals, FMCG, and chemicals.

Drivers of Rental Growth and Grade A Warehousing Concentration
The rise in demand from the manufacturing sector, coupled with the resurgence in space uptake by e-commerce entities, is forecasted to be the primary drivers of rental growth in the warehousing sector. Bengaluru, Delhi-NCR, and Mumbai witnessed substantial rental rate increases, reflecting the growing demand. Additionally, Pune and Chennai stand out for their concentration of Grade A warehousing, particularly driven by demand from auto and auto ancillary occupiers.

Investment Influx and Future Supply Growth
Recent years have seen a significant influx of investments in India's warehousing sector, positioning the country to generate enough supply to meet the demand for 223 million square feet of Grade-A warehousing space within the next three years.

Technological Advancements and Multi-Storey Warehousing Potential
Technological advancements are reshaping the warehousing landscape, with increasing demand for modern facilities equipped with automation, robotics, IoT, and RFID systems. Moreover, the potential for multi-storey warehousing is gaining traction, driven by the need to optimize land usage, particularly in cities facing land constraints like Mumbai, Bengaluru, and Kolkata.

Addressing Challenges and Expanding Horizons: The Evolving Dynamics of India's Warehousing Landscape

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