TVS Industrial & Logistics Parks Pvt Ltd

South Asia Construction and real estate

TVS Industrial & Logistics Parks Pvt Ltd is an industrial real estate developer in India. The company focuses on developing investment-grade warehouses in underserved markets, helping to facilitate trade and transport with efficient logistics facilities.

Our investment

Our investment in TVS Industrial & Logistics Parks Pvt Ltd will support the construction of 4.2 million square feet of resource-efficient Grade A warehousing across India. This will create 3,000 jobs (FTE) for construction contractors and support the creation of up to 500 jobs for employees of TVS’ tenants during warehouse operations. The adoption of green building standards will deliver energy and water savings and greenhouse gas emission reductions and send a clear market signal by demonstrating their commercial attractiveness.

Impact
  • Create employment opportunities (SDG 8.5) through contributing to sustainable industrialisation (SDG 9.1).
    • Improve environmental sustainability through resource efficiency (SDG 9.4) and climate mitigation (SDG 13.A).
Primary Secondary
  • Direct: Construction and operation of 4.2 million square feet of Grade A warehouses.
  • Direct: Eight warehouses constructed to EDGE Advanced certification delivering energy and water savings and associated greenhouse gas emission savings.
  • Economic enabler: Through significantly increasing the stock of Grade A warehouses, enabling improved efficiencies of logistics-dependent industries and boosting India’s competitiveness.
  • Catalysing markets: EDGE Advanced certification of TVS’ warehouses is expected to send a clear market signal by demonstrating the commercial attractiveness of applying green building standards, contributing to increased proportion of new warehouse developments EDGE certified in India.
Stakeholder Geography Characteristics
Employees

Pan-India. For direct employment: c. 60 per cent in category ‘D’ states, c. 20 per cent in category ‘C’ states, c. 20 per cent in category ‘A’ and ‘B’ states.

  • Construction contractors: c. 54 per cent unskilled, c. 46 per cent skilled labour.
  • TVS tenants’ employees: c. 70 per cent workers, c. 30 per cent managerial.
Planet

Global (C02 emissions) and local (water)

Greenhouse gas emissions reduction; reduced water usage

Scale Depth/Duration
  • Employees: 3,000 construction jobs (FTE); 500 jobs (FTE) during operations (assessing the scale and depth of indirect job creation resulting from wider economic development is challenging).
  • Planet: Reductions from one assessment of a TVS warehouse constructed to EDGE Advanced standard has shown reduction in water use of c. 10 per cent and a c. 5 per cent gain in energy through high-efficiency AC, which translates to total estimated savings of 93 metric tonnes of CO2 and a minimum of 3,300m3 water usage per year. Water and energy savings will also be achieved at the other warehouses in pipeline.
Grid Score Contribution

2.55

To help us direct our investments, we use a tool called the Development Impact Grid. The Grid scores every investment we plan out of a score of four, based on two factors: the difficulty of investing in the country and whether investment in that sector will lead to jobs.

  • Financial: Capital not offered on the same terms.
  • Value-add: Improvement of processes, practices or standards: CDC will support TVS to improve environmental, social and business integrity governance and processes.
  • Climate change: TVS is required to construct all new warehouses to EDGE40 (Advanced) and to commission energy and water audits for existing warehouses.
Risk
  • Execution: The strategy of the platform is ambitious, with multiple locations being built at the same time. Delays in development timelines would also result in delayed impact. This risk must be tolerated to achieve the impact.
  • Evidence: While the academic literature supports the economic enabling impact of logistics infrastructure, assessing the scale and depth of impact of individual warehousing is challenging.
  • Unintended: Potential for displacement of existing lower-standard warehouses and associated jobs. This risk is considered low. In addition, jobs created in new Grade A warehouses are likely to be of better quality than those in existing lower-standard warehouses.

Environmental and social aspects

We are engaging regularly with the TVS team and the newly appointed environmental and social manager to help them shape their environmental and social management system (ESMS). We are also supporting the company to integrate green building principles in warehouse design through EDGE certification.

Key facts

Status:
Active
Region

Since 2012, we’ve only invested in Africa and South Asia. Investments outside these regions are from our pre-2012 portfolio.

:
South Asia
Countries:
India
Sector

We have seven priority sectors. However, we continue to invest outside these sectors, largely in the most challenging regions, as new investment supporting any sector helps to underpin the private sector, and create jobs and livelihoods for people.

:
Construction and real estate
Investment type

We provide capital in three broad ways: direct equity, debt, and intermediated equity (principally through investment funds).

:
Direct Equity
Start date

For direct investments, this is the date CDC committed capital to the business or project.

For funds, this is the date that CDC committed capital to the fund.

For underlying fund investments, this is the date that the fund invested capital into the business.e

:
December 2020
Amount

For direct investments, this is the total amount that CDC has committed to the business or project (it may be a combination of equity and debt).

For funds, this is the total amount that CDC has committed to the fund.

:
$37m
Domicile

This is the investee company’s place of incorporation; or a fund’s jurisdiction.

:
India