In the first face-off between billionaires on a business in which Gautam Adani is the undisputed king, Mukesh Ambani-led Reliance Industries Ltd is said to have emerged the highest bidder for developing and operating India’s first multi modal logistics Park (MMLP) planned by the Union Government at Mappedu near Chennai in Tamil Nadu’s Thiruvallur district.
Multiple sources said that the price bid placed by Reliance Industries in the closely contested tender is understood to be the “highest” in terms of the minimum guaranteed revenue share based on the net present value discounted at a certain rate – the bid parameter that decides the winner.
Reliance Industries Ltd and Adani Logistics Ltd, a wholly owned unit of Adani Ports and Special Economic Zone Ltd (APSEZ), were the two bidders that had qualified for the first MMLP under the Bharatmala Pariyojana.
Reliance Industries is said to have quoted a minimum guaranteed revenue share of some Rs459 crore – the amount it will pay the National Highways Logistics Management Ltd (NHLM) – over a concession period of 45 years, compared to about Rs400 crore quoted by Adani Logistics.
The minimum guaranteed revenue share will begin from the third year of starting commercial operations.
“The bids are under evaluation, it is yet to be awarded,” Prakash Gaur, Chief Executive Officer, National Highways Logistics Management Ltd told ET Infra, adding that “the tender will be finalised in a week to ten days”.
The successful bidder will have to invest some Rs782.58 crore to develop the MMLP spread over 158 acres of which 122 acres is owned by the Centre-owned Chennai Port Authority while the balance 36 acres is given by the Tamil Nadu Industrial Development Corporation (TIDCO).
The project will be implemented by a special purpose vehicle (SPV) majority owned by the National Highways Logistics Management Ltd, a fully owned subsidiary of the National Highways Authority of India (NHAI), the country’s highway development agency.
Chennai Port Authority, TIDCO and Rail Vikas Nigam Ltd will also hold equity in the SPV, the first two in lieu of the land given to the project.
A multi modal logistics park is a cargo consolidation and distribution centre using multiple modes of transport to achieve scale in shipments and provides various logistics and other value-added services.
It acts as an intermodal freight-handling facility with mechanized material handling provisions that contains warehouses, specialized cold chain facilities, freight/container terminals, and bulk/break-bulk cargo terminals.
Typically, MMLPs include inter-modal connectivity such as dedicated railway line/spur, access from prominent highways/expressways to allow movement of commercial vehicles and connectivity to an airport or a seaport or inland waterway terminal.
The value-added services provided by a MMLP includes customs clearance, late-stage processing activities such as sorting/grading, aggregation/ disaggregation, cold storage etc. to provide flexibility to the users at a single location.
Over the past two years, Gautam Adani has entered businesses in which Mukesh Ambani has strengthened his presence such as green energy, data centres and more recently telecom. However, Ambani has so far stayed clear of entering Adani’s terrain such as ports, logistics, airports, and power, to name a few.
“Multi modal logistics parks were bound to be on the cards for Reliance Industries to back its ambitious and aggressive plans for retail and agro business,” said an industry consultant tracking the MMLP tenders.
“To promote these businesses, Reliance Industries needs its own logistics set up such as multi modal logistics parks and transport and also to reduce dependencies on other logistics players,” he stated.
Adani Ports and Special Economic Zone Ltd (APSEZ), India’s biggest transport utility, runs 81 trains, 9 MMLP’s, 1.1 million metric tonnes (mmt) of grain silos, 1.4 million sq feet of warehousing and 620 kms of rail tracks.
The company runs a fleet of 900 trucks, comprising 740 container moving trucks and 160 tippers.
By 2026, APSEZ is aiming to become the largest private train operator with over 200 trains, 15 MMLP’s, over 2.5 mmt of grain silos, 60 million sq ft of warehousing and over 2,000 kms of rail tracks. The integrated logistics model pursued by APSEZ with presence across the value chain, encompassing ports, special economic zones and logistics allows customers to access services under a single window.
