RIL builds a $2.4–$3 billion Infra Investment Trust

14 Apr 2023 CW Team

Reliance Retail Ltd, India's largest retailer in terms of revenue, scale, and profit, has already began laying the groundwork for the future InvIT of its warehouse assets, having registered a trust with the Securities and Exchange Board of India (Sebi) at the end of February.

The warehouse assets that the business seeks to monetise will be stored in this trust, they noted.

The petchem-to-personal-products conglomerate aims to arrange the vehicle as a privately placed or listed InvIT, though details are still being worked out. It has started working with its financial and legal advisors.

Reliance Retail's monetisation
The firm was formed to create, develop, acquire, provide, manage, and operate storage, warehousing, supply chain, cold chain, logistics infrastructure, and facilities, according to its memorandum of association.

According to RIL's most recent financial reports, Reliance Retail owned a storage portfolio of 33.6 million square feet as of December 31, 2022. In FY22, Reliance Retail expanded 11.1 million square feet, bringing its total storage area to 22.7 million square feet. In the previous three years, the warehouse area of the company has tripled.

The business has purchased a majority stake in Addverb Technologies, which provides warehouse automation solutions and robotic material handling equipment. It has been testing 5G robots and drones for bagging lines and warehouse storage site logistics, both of which would require human participation otherwise.

The goal to monetise Reliance Retail's warehouse and related logistics assets comes at a time when the company is actively growing its warehouse capacity.

Metro Cash & Carry India Pvt Ltd's Rs 2,850 crore acquisition will also help Reliance Retail Ventures Ltd (RRVL) expand its warehouse network for the B2B e-commerce platform JioMart Kirana as well as its B2C hypermarket operation, according to experts working with the firm.

Reliance Retail had its own cash and carry company, Reliance Market, prior to the Covid-19 epidemic. These buildings, however, were closed and converted into warehouses and a fulfilment center to service Kirana's e-commerce business.

"A lot of capital has gone into building top-class warehouse space for industries such as retail, e-commerce, industrials, pharma, etc. More warehousing InvITs are expected to come up, given the huge demand for warehousing space in a growing economy like India," the banker added.

Reliance Industries Ltd (RIL) has launched a process that could see the corporation unlock value in its retail business's backend warehouse and related logistical assets through an infrastructure investment trust (InvIT). Reliance Retail Ltd, India's largest retailer in terms of revenue, scale, and profit, has already began laying the groundwork for the future InvIT of its warehouse assets, having registered a trust with the Securities and Exchange Board of India (Sebi) at the end of February. The warehouse assets that the business seeks to monetise will be stored in this trust, they noted. The petchem-to-personal-products conglomerate aims to arrange the vehicle as a privately placed or listed InvIT, though details are still being worked out. It has started working with its financial and legal advisors. Reliance Retail's monetisation The firm was formed to create, develop, acquire, provide, manage, and operate storage, warehousing, supply chain, cold chain, logistics infrastructure, and facilities, according to its memorandum of association. According to RIL's most recent financial reports, Reliance Retail owned a storage portfolio of 33.6 million square feet as of December 31, 2022. In FY22, Reliance Retail expanded 11.1 million square feet, bringing its total storage area to 22.7 million square feet. In the previous three years, the warehouse area of the company has tripled. The business has purchased a majority stake in Addverb Technologies, which provides warehouse automation solutions and robotic material handling equipment. It has been testing 5G robots and drones for bagging lines and warehouse storage site logistics, both of which would require human participation otherwise. The goal to monetise Reliance Retail's warehouse and related logistics assets comes at a time when the company is actively growing its warehouse capacity. Metro Cash & Carry India Pvt Ltd's Rs 2,850 crore acquisition will also help Reliance Retail Ventures Ltd (RRVL) expand its warehouse network for the B2B e-commerce platform JioMart Kirana as well as its B2C hypermarket operation, according to experts working with the firm. Reliance Retail had its own cash and carry company, Reliance Market, prior to the Covid-19 epidemic. These buildings, however, were closed and converted into warehouses and a fulfilment center to service Kirana's e-commerce business. A lot of capital has gone into building top-class warehouse space for industries such as retail, e-commerce, industrials, pharma, etc. More warehousing InvITs are expected to come up, given the huge demand for warehousing space in a growing economy like India, the banker added. See also: TVS Industrial and Logistic Parks plans to double its portfolio Welspun One Logistics Parks launches second fund of Rs 2,000 crore