The Central Warehousing Corporation (CWC) has plans to double its revenues in the next two years through capacity expansion in the warehousing space and a bigger play in third-party logistics (3PL) and domestic container business. The company posted annual revenues of ₹2,175 crore in FY23.
CWC is the nation’s largest warehouse player by reach and land bank with about 115 lakh MT (metric tonne) capacity across warehouses in 465 locations across the country today. While 45% of the space (and revenues) are from the storage of agriculture products/food grains, the e-commerce sector accounts for another 20%. The rest is industrial products.
“We have a massive capacity expansion plan for this year and next year. We are adding about 47 lakh sq ft of capacity, which will be the double of what we have added in the last two years. This is through our own capex. We have earmarked about Rs 1000 crores for this. This will be all Grade A (industrial capacity)” says
Amit Kumar Singh, Managing Director, CWC.
CWC is also exploring the option of expanding its capacity through partnerships between the public and private sectors (PPP). According to Singh, they have identified approximately 85 locations that are slated for modernization and facility development through private participation. Over the next two years, it is anticipated that the private sector will contribute around Rs 1500 crore for these PPP ventures, leading to the addition of roughly 120 lakh sq ft of Grade A warehouse capacity.
In tandem with this, the Corporation has strategic plans to establish a network of cold storage facilities offering value-added services under the PPP model. Singh revealed that CWC has pinpointed 180 locations for this initiative, many of which are either hubs of production or consumption for perishable goods. Given the country’s lack of an efficient cold storage network and substantial losses incurred in the perishables sector, these facilities are intended to address these pressing concerns.
Having conducted a preliminary study, CWC is now embarking on a more comprehensive examination. They intend to offer the foundational infrastructure, including land and civil structures, at all these locations. Private entities interested in participating will be responsible for retrofitting and operation for a defined duration. This endeavor is expected to attract an additional investment of Rs 800 crore to Rs 900 crore from the private sector.
Alongside the provision of value-added services for agri-business and comprehensive solutions for major players in agri and industrial warehousing, CWC is also venturing into the realm of third-party logistics (3PL). The acquisition of container rakes is underway, with orders for rail logistics already in place. This shift is poised to alter the current business landscape, with an anticipated expansion in the industrial segment in terms of business and revenue. The driving forces for demand are expected to stem from 3PL players and aggregators.
Interestingly, the government is concurrently working on transforming CWC into a company by amending the Warehousing Corporation Act that currently governs its operations. This adjustment in legal structure is anticipated to empower the company’s board and grant greater flexibility to its mandate, equipping it to better contend with the growing competition within the warehousing and logistics domain.
