NBHC to set up 350 warehouses in 3-5 yrs

National Bulk Handling Corporation (NBHC), the warehousing arm of India’s largest commodity exchange — the Multi Commodity Exchange (MCX) — is contemplating building 300-350 modern warehouses near the major mandis in remote agricultural states.

“The final decision on the investment size of this expansion has not been taken. We are scouting for adequate land near the major mandis to create storage capacity of between 15,000 and 25,000 tonnes each,” said Anil Choudhary, MD and CEO of NBHC.
 

THE BLUEPRINT

• National Bulk Handling Corporation (NBHC) is scouting for land to build around 300 warehouses, which can store commodities between 15,000 and 25,000 tonnes each
• The company is planning to make warehouses with commodity-friendly moisture and humidity content, which will be connected with a central server so that banks can finance farmers within 24 hours from the time of deposit of the commodity

Though minimum area of land has not been specified, Choudhary added that there should be enough space to set up warehouses, logistics movement and quality storage facility. The company is planning to create warehouses with commodity-friendly moisture and humidity content with centrally located camera.

These warehouses will be connected with a central server so that banks can finance farmers within 24 hours from the time of deposit of the commodity on the basis of warehouse receipts issued by NBHC.

The company is in advanced discussions for finalising the model to generate funds for the project. In the process, it may divest a small chunk of equity through private placement, for which talks will be initiated once the investment size is decided.

Meanwhile, armed with 25 best-quality labs, 200 mobile labs and 381 franchisee-owned warehouses in 800 locations across the country, NBHC is currently dealing with 24 nationalised and private banks as collateral manager.

The company has 1.8 million tonnes of storage facility in 18 states. With cumulative assets under management of about 4 million tonnes (valued at about Rs 7,000 crore) across over 3,000 storage facilities, NBHC has brought the kind of liquidity that agro commodities never saw before.

“We are looking for an opportunity to set up warehouses in predominatly rural and semi-urban areas where retail farmers even with a bag of commodity may avail maximum benefit of loans through collaterally-managed banks,” said Choudhary.

For small farmers to access the warehousing facility, the company has tied up with Saurashtra Grameen Bank, an RRB promoted by the State Bank of Saurashtra and talks are on with similar understandings with Narmada Malwa Grameen Bank in Madhya Pradesh and Pragati Grameen Bank in Bellary, Karnataka.