British International Investment

TVS Industrial & Logistics Parks Pvt Ltd

South AsiaConstruction & 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.

This investment was made when British International Investment was named CDC Group.

Our investment

Description of the 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 information

Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.

What?

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).

How?

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.

Who?

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

How much?

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.

Contribution/additionality

Contribution/additionality
  • Financial additionality: Capital is not offered on the same terms.
  • Value additionality: Improvement of processes, practices or standards: We will support TVS to improve environmental, social and business integrity governance and processes. TVS is required to construct all new warehouses to EDGE40 (advanced) and to commission energy and water audits for existing warehouses.

Grid score

Grid Score

To help us direct our investments, we previously used a tool called the Development Impact Grid. It scored investments out of four, based on two factors: the difficulty of investing in a country and the propensity of the sector to generate employment. This tool was used for investments until the end of 2021. Since 2022 it has been replaced by the Impact Score.

2.55

Risk

Execution Risk
  • 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.G69
Evidence Risk
  • While the academic literature supports the economic enabling impact of logistics infrastructure, assessing the scale and Depth of impact of individual warehousing is challenging.
Unexpected Impact Risk
  • 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 information

  • Environmental and social summary

    A high-level description of the environmental and social aspects of the investment. This may include a summary of key environmental and social risks identified during environmental and social due diligence (ESDD); key elements of an environmental and social action plan (ESAP); or ways in which we plan to support the investee improve environmental and social standards, such as through their environmental and social management system (ESMS); as well as any other priority areas agreed with the investee.

  • Environmental and social risk

    A risk category rating, which indicates the level of environmental and social risk associated with an investment. For an explanation of the categorisations used, see here. We consistently provide an environmental and social risk category for all investments screened from 2023 onwards.

Environmental and social summary

TVS ILP completed the E&S action plan within the agreed timeline. Our focus is on the development of a robust environmental and social management system, with a focus on areas like land acquisition, occupational health and safety, contractor management, and emergency preparedness and response that can lead to high risks in the construction and real estate sector. In terms of value add, BII introduced the concept of green building certifications (EDGE).articular areas of focus include E&S impact assessment, portfolio monitoring, and safeguarding.

Reporting and Complaints Mechanism

The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to [email protected] or by mail. See more details on our Reporting and Complaints Mechanism here.

For any other general enquiries contact us at [email protected]

  • Key facts

    Last updated

    When the last quarterly update of the website database occurred.

    :
    June 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D4235
    Status

    The current status of the investment (green flag for active and red flag for exited).

    :
    Active
    Region

    The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.

    :
    South Asia
    Country

    The countries where the investment delivers impact. Where impact is delivered in multiple countries, this is indicated.

    :
    India
    Sector

    We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.

    :
    Construction & Real estate

    We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.

    For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.

    For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.

    For direct equity investments, this is the date at which British International Investment exited the investment.

    For debt investments, this is the date at which the final debt repayment was made.

    For funds, this is the date at which the fund was terminated.

    For underlying fund investments, this is the date at which the fund manager exited the investment.

    The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.

    For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.

    The currency in which the investment was made.

    Investment type :
    Equity
    Start date :
    December 2020
    Amount :
    $37m
    Currency of investment :
    INR
    Domicile

    The company or investment fund’s place of incorporation.

    :
    India
    Climate finance

    Indicates whether the investment is climate finance qualified or partially climate finance qualified and the type of climate finance (adaptation, mitigation or both). We define climate finance using the multilateral development bank (MDB) and the International Development Finance Club (IDFC) Common Principles climate finance methodology. See Common Principles for Climate Mitigation Finance Tracking and Common Principles for Climate Change Adaptation Finance Tracking. We provide the climate finance qualification and type for commitments from 2020 onwards, which is when we launched our Climate Change Strategy.

    :
    Fully qualified
    Climate finance type:
    Mitigation

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