Flipkart India Private Limited, the wholesale entity of the Walmart-backed home-grown e-commerce company, has received Rs 2,838.84 crore from its Singapore-based parent entity, Flipkart Private Limited.
The investment comes at a time when the government is coming up with National E-commerce Policy that could have a huge impact on online retailers such as Flipkart and Amazon.
According to the company’s regulatory filings, Flipkart’s parent entity was issued 8,15,761 equity shares through the ‘rights issue’ at a premium of Rs 34,799 per share. The board of directors of Flipkart India passed this resolution on November 28, 2019.
This year in September Flipkart India received Rs 1,616
The funding is expected to help Flipkart take on Jeff Bezos-led Amazon, with which it is in a fierce battle for dominance in India’s online retail market as well as competition from the yet to be launched e-commerce business of Mukesh Ambani-led Reliance Industries. In October this year, Amazon infused about Rs 4,472.5 crore in its various business entities in India, including seller services, digital payments and retail.
The e-commerce market in India is expected to touch $200 billion by 2028, from about $30 billion last year. The fund infusion is also helping players like Flipkart and Amazon for their festive season sales.
In October this year, Flipkart and Amazon, the country’s premier e-commerce firms claimed top spot with their own set of numbers in mega-festival season sales. They had said more than half their growth during this period came from new customers, especially those in smaller cities and towns.
Flipkart said the company had close to double the growth in terms of customer and transaction metrics during The Big Billion Days (TBBD) sale this year, rival Amazon said its growth was three times in its Prime member signups while over 50 percent of its sales came from smaller towns.
Doug McMillon, President and CEO, Walmart recently said that Flipkart’s flagship festive sale ‘The Big Billion Days’ sale was a success again this year, powered by shoppers and sellers from tier-2 cities and beyond with nearly 75 per cent growth in new customers versus last year.―India Finance News