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Apeejay Real Estate, a firm that possesses and oversees warehouses, office spaces, and retail properties nationwide, is seeking to secure funds ranging from Rs 400 crore to Rs 500 crore to expand its logistics park operations. The company is currently in discussions with three prospective investors with the intention of utilizing the funds primarily for the acquisition of land for warehouse development.
The funding would be raised at a platform level for the logistics park enterprise, meaning that external investors would acquire shares in all the assets hosted on this platform. This investment is expected to grant the new investor ownership of approximately 35-40 percent of the platform. Apeejay has enlisted the services of Ambit Capital as its advisor for this endeavor.
According to Shouvik Mandal, the CEO of Apeejay Real Estate, the objective is to expand the warehouse operations from 3 million square feet to 10 million square feet within the next 3-5 years. Mandal clarified that the company’s promoters have already infused approximately Rs 500 crore into the business. However, in order to achieve the next level of growth they’re aiming for, they require external equity investment since taking on debt for land acquisition is not permissible. Apeejay is actively searching for suitable land in locations like Dankuni, Manesar, Ghaziabad, and Palwal.
The company has pinpointed potential land plots in various locations, but the actual transactions will occur after securing investment from the investor. Currently, Apeejay manages logistics parks in four areas: Haldia, Kalinganagar, Hyde Road in Kolkata, and Ballabgarh near the National Capital Region (NCR). There is room for expansion in these existing locations, aligning with market demands. These logistics parks offer a mix of covered warehouses and open spaces. While the primary focus is on warehouses and logistics parks, the Apeejay Group is also exploring opportunities within different segments of the logistics value chain.
Earlier this year, Apeejay Real Estate, in collaboration with a Nepalese firm, secured a contract to operate the Birgunj integrated check post situated at the India-Nepal border. This facility, comprising a dry port, integrated check post, and container freight station, is poised to facilitate the growing trade between India and Nepal. Furthermore, Apeejay is actively considering bids for the development of a multi-modal logistics park in proximity to the Calcutta Dock System. The Shyama Prasad Mookherjee Port, Calcutta, has initiated a leasing opportunity for 59 acres of land for a 30-year term for such a project. This expansion in the logistics sector complements Apeejay Group’s existing business portfolio, which also includes shipping.
Apeejay Shipping, which recently celebrated its 75th year in operation, is the third-largest Indian shipping company, boasting a fleet of 10 vessels. The shipping division also has ambitious plans to expand its fleet size and aims to achieve a Deadweight Tonnage (DWT) of 1 million tonnes, marking a 50 percent increase from its current capacity.
Apeejay Real Estate runs shared office spaces under the Apeejay Business Centre (ABC) brand in cities such as Kolkata, Mumbai, NCR, and Hyderabad. Presently, the company manages 2,000 seats, primarily within properties owned by the Paul family, the promoters of the business. Theirgoal is to scale up to approximately 6,000 seats within the next three years.
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