India's warehousing supply to grow by 13-15% in FY24: ICRA

The supply will include about 52 per cent of grade A capacity, while the incremental absorption is projected to remain at FY23 levels of around 39 msf, an ICRA report said.

By March next year, Mumbai and the Delhi National Capital Region (NCR) are expected to account for nearly half of the total IWLP stock.

The top five markets—Mumbai, NCR, Pune, Chennai and Kolkata—accounted for 75-78 per cent of total IWLP stock in India as on March 2023. The overall occupancy remained healthy at around 90 per cent.

The country’s warehousing sector continues to witness a sustained demand from third-party logistics (3PL) and automobile sectors, which together accounted for about 53 per cent of the total leased warehousing area in ICRA’s sample as on March this year.

"ICRA expects the Grade A warehouse stock for the eight primary markets to grow at 17 per cent year on year (YoY) to 195 msf by March 2024 from 167 msf as of March 2023. For incremental Grade A supply addition of 28 msf in FY2024, the absorption is estimated to be around 24 msf," ICRA assistant vice president and sector head Tushar Bharambe was quoted as saying by a news agency.

The 3PL and the automobile sectors, accounting for around half of the occupied warehousing area as on March this year, are projected to grow at 8-9 per cent and 6-9 per cent respectively in FY24, Bharambe added.

ALCHEMPro News Desk (DS)