TVS ILP intends to raise up to $100 million through Warehouse InvIT

TVS Industrial and Logistics Parks (TVS ILP), a division of TVS Group’s logistics company TVA (TVS) Supply Chain Solutions, has begun monetizing warehouses, which it develops and operates through an Infrastructure Investment Trust (InvIT). The proposed monetization will likely raise TVS ILP up to $100 million through the trust, according to two sources with knowledge of the company’s plans.

TVS ILP is engaged in the development and rental of industrial halls and logistic infrastructure parks. The current portfolio spans six states and caters to customers in industries such as automotive, FMCG, e-commerce and agriculture.

“TVS is working with investment banks Axis Capital and Kotak Mahindra Capital to set up the InvIT and help raise funds. TVS has applied to regulator Sebi to register the trust that will hold the assets,” one of the sources said.

The InvIT plans are still in their early stages and the details of the InvIT structure and assets to be transferred are still being worked out, the second source added.

“They have about 7 million square feet of operational storage space. A significant part of this portfolio is subject to InvIT. They want to raise up to $100 million from this first tranche of assets that will go to InvIT,” he said.

The group expects to have an additional 3 million square feet operational by the end of the year, the second source said, adding that those assets will be brought into the InvIT at a later date once plant operations stabilize. The group plans to expand its warehouse portfolio to 20 million square feet over the next 3-4 years, he added.

“As part of our growth, we continue to explore different avenues to raise capital to fund our projects, including considering the option of issuing an InvIT. However, as the details are still being worked out, the numbers you provided in the email are therefore not reasonable,” said Manikandan R, COO, TVS Industrial & Logistics Parks.

TVS ILP was formed in 2005 as a 50/50 joint venture between TVS Supply Chain Solutions Ltd and Ravikumar Swaminathan & Associates. In March 2021, CDC Group, now known as British International Investments, the UK government’s development finance arm, invested 250 crore of equity and acquired a 40% stake in the company, with the other two shareholders each holding around 30%.

According to an October report by Care Ratings, TVS Supply Chain Solutions accounts for about 28% of TVS ILP’s revenue.

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