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Vehicle parking: A fresh avenue to tap big money

The Economic Times:  June 04, 2008

New Delhi: In a country where cars are using up more road space everyday than is being added, there isn't a better business to park your money than, well, parking.

Close to 8 lakh cars are sold in India every year, growing an average 10%, while another 5 million two-wheelers are being added year-on-year at an astounding 15%. While it demonstrates the growing wealth of Indians and their equally growing drive for things material, cities are becoming choc-a-block.

What's more, the problem has now steered into tier II and tier III towns where infrastructure development is still pathetic.

However, the big problem for everyone has become a great opportunity for many smart entrepreneurs. As city authorities get into the act of creating automated multi-level parking systems, revenue from the business is estimated to grow from Rs 50 crore today to Rs 500 crore in the next four years, say experts.

Sample this: Delhi Metro Rail Corporation is coming up with a fully automated 20 level underground parking system, Kolkata Municipal Corporation (KMC) and even Brihan Mumbai Municipal Corporation all looking up to parking solutions.

The Kolkata-based Simpark Infrastructure, a wholly-owned subsidiary of Simplex Projects, is one such company that has been working on government projects like the one that was completed recently as an underground modern automated car parking system at one of the most congested areas of Kolkata, the New Market complex.

"We are doing NDMC projects too. One such project is coming up in Kamla Nagar within the next 15-20 days with a capacity of around 800 cars. In Kota, also we are working on a project for the municipal corporation for a capacity of 120 cars," says Simpark director Arup Choudhury.

Apart from Kolkata, Guwahati and Kota, the company is also eyeing projects in Mumbai, Udaipur and Pune. "Not only four-wheelers, we have also sent proposals to the government of Guwahati for two-wheeler parking. The success of the four-wheeler plan may soon percolate to the two-wheeler parking systems as well," added Mr Choudhury.

The project cost of an automated multilevel parking facility for 200 cars may vary from Rs 2 crore to Rs 10 crore depending upon the level of automation involved. To make parking projects viable on a stand-alone basis, the revenue from a car parking space needs to be a minimum of Rs 50 per hour. Since no public parking facility in India has such high parking rates, the local government authorities are beginning to allot parking-cum-commercial projects to private sector companies.

The Pune-based RR Parkon, a subsidiary of the Rs 1,500-crore Ram Ratna Group, is another company that has completed two projects in Pune, one in association with Pune Municipal Corporation and the other at a city hotel. The company has already executed 40 projects at various locations in Mumbai, Pune, Ahmedabad, Chennai, Kolkata, Delhi and Jaipur. The company is designing about 3,000 automated multi-level car parking systems for various cities in India. Automated multi-level car parking systems have emerged as parking solutions on city roads, as well as residential and commercial establishments.

Also, take the case of Kinetic Escalator & Elevator Company (KEEL), which belongs to Pune's Kinetic Group. "When parking is an issue in big cities, nobody is actually bothered about the cost per month that are incurred. Apart from Mumbai, we are also looking for projects in tier-II cities," said Ajay Raina, chief operating officer of KEEL.

Suvidha Park Lift, a Delhi-based company, is another example that has worked for government departments. It has completed a fully-automated project for Brihan Mumbai Municipal Corporation for 240 cars.

"We are also planning many projects in tier-II cities. Our automated multilevel parking systems are extremely successful as we provide world-class technology. At present, majority of our projects and installations are in cities that are near the seashore, like Mumbai, Chennai and other cities," says Pranav Poddar, director of Suvidha Park Lift.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.