By Salman SH and Sneha Johari
Ecommerce giant Amazon has added new funds worth Rs 1,980 crore (~ $290 million) into its Indian business unit, reports Mint. The report adds that Amazon India has now received Rs 7,679 (~$1.1 billion) since July 2014, which includes the infusion of Rs 1,696 crore in December last year, according to a filing with the Registrar of Companies (ROC).
To MediaNama’s query about the new funds infusion, Amazon said, “We are very pleased with the growth momentum we are witnessing in India. In Q4-2015 we sold more than we did in all of 2014. We are committed to invest aggressively in the country with a long term horizon and transform the way India buys and sells.”
The recent fund addition comes after Jeff Bezos, founder and CEO of Amazon, pledged $2 billion in India, back in 2014 to support its growth and improve the customer & seller experience in the country. Amazon has been expanding across multiple product categories claiming to add up to 40,000 products per day in 2015, with more than 30 million products on it platform. The number of sellers on Amazon India reportedly grew by 250% year-on-year, while the 2015 Diwali season sale fetched the e-tailer daily sales of approximately four times of what it made in 2014.
Financials: The company reported a net profit of $482 million during Q4 2015, registering a 125% growth in net profits, from $214 million in the same quarter last year. The company also posted revenues of $35.75 billion in the same quarter—a growth of 21.88% from $29.33 billion in the same period last year.
Developments in ecommerce in India:
– Alibaba is reportedly in talks with Flipkart and Snapdeal to acquire parts of their stakes, according to a Mint report. The Chinese ecommerce player had got an approval from the Competition Commission of India to buy 4.14% stake in Snapdeal in October last year.
– In September 2015, Flipkart confirmed raising $700 million in a fresh round of funding at a valuation of $15.2 billion from Tiger Global and existing investors including Steadview Capital. The company had previously raised $700 million in December 2014. It recently named Binny Bansal as the new CEO and Sachin Bansal the new executive chairman. In December, it acquired a strategic minority stake in MapmyIndia to pad its supply chain and logistics operations. (Our Flipkart coverage)
Related read: Flipkart’s top shopper in 2015 is single, male and works in an office
– In August 2015, Snapdeal raised $500 million in funding led by Foxconn, Alibaba and existing investor Softbank, with participation from other existing investors. In October, it invested $20 million in logistics firm GoJavas to further enhance its supply chain and logistics. It had picked up a minority stake in the company for an undisclosed amount in March last year. (Our Snapdeal coverage)
With an alternate business model in place, Amazon has strategically marked itself on the Indian e-commerce market. With fresh funds in place, India could soon turn out to be a focal market for the company as it recently lost to Alibaba in China. The Indian e-commerce market is yet to reach its saturation point and is largely untapped and it will be interesting to see where this goes.