ADIA Invests in Indian Warehouses: Boosting Abu Dhabi's Portfolio

04 May, 2024

ADIA Invests in Indian Warehouses Boosting Abu Dhabi's Portfolio

Mukesh Ambani, chairman and managing director of Reliance Industries, is set to see his company's warehousing arm benefit from a substantial investment from Abu Dhabi Investment Authority (ADIA) and US-based private equity firm KKR. The infusion of INR 12,000 crore ($1.5 billion) into India’s Reliance Retail Ventures’ warehousing assets marks a significant move in the market. Both ADIA and KKR have equally contributed to Reliance Logistics and Warehouse Holdings (RLWH), a subsidiary of Reliance Retail established in December 2022.

The collaboration between KKR, ADIA, and Reliance Retail ensures stability through long-term lease agreements spanning at least two decades. There are prospects for extending the agreement further, potentially increasing the investment to $2 billion in the future, according to reports. This strategic move follows previous investments by KKR and ADIA in Reliance Industry Limited’s digital and telecom ventures.

Reliance Retail, under the stewardship of Mukesh Ambani, has been actively raising funds. In FY24 alone, it secured INR 17,000 crore from global investors, including the Qatar Investment Authority. With over 18,000 stores operating across various sectors from groceries to electronics, Reliance Retail competes with global giants like Amazon and Walmart’s Flipkart in the expansive Indian market. The warehousing industry in India has witnessed substantial growth recently, driven by factors such as e-commerce expansion, manufacturing sector growth, and government-led infrastructure development initiatives. According to projections, the sector is poised to reach INR 2,800 billion by 2027, up from INR 1,200 billion in 2021.