The Singapore-based holding company of India’s largest e-commerce marketplace Flipkart has infused Rs 48.4 billion into two of its largest India entities as it plans to step up its investments in the country to stay ahead of rival Amazon.
Flipkart Limited, which is based in Singapore, has infused Rs 44.7 billion into the marketplace unit Flipkart India. Flipkart Marketplace, another Singapore-based entity, has invested Rs 3.7 billion into Flipkart Internet, which runs the company’s retail platform.Both the investments, which were received in early February were disclosed to the Registrar of Companies (RoC) this week, the documents for which were sourced by Business Standard from Paper.vc.
The infusion into its India units comes after the company raised close to $4 billion in two rounds from investors including Tencent and SoftBank last year. The second investment of $2.4 billion made by SoftBank includes a primary and secondary component, the split of which has not been displaced by either Flipkart or the investor.
It also comes at a time when US-based online retail giant Amazon has massively stepped up its investments in India. RoC documents show that Amazon invested a combined Rs 62 billion into its Indian units in the calendar year 2017. Both companies continue to be locked in the battle for supremacy in India’s online retail market.
A large chunk of Amazon’s investments in India are going into its Prime loyalty programme which offers free one and two day shipping on products and unlimited access to video and music streaming services. Flipkart on the other hand lacks a loyalty programme, but the company is known to be readying a programme behind the scenes.
Both Flipkart and Amazon are also heavily investing in growing their grocery businesses, something which they both believe will help increase the frequency with which shoppers buy products on their platform. While Amazon already runs its Pantry, Now and other daily use item services in India, Flipkart’s grocery delivery business is still in its pilot phase and available only in Bengaluru.
Flipkart is still said to be ahead of Amazon in terms of gross merchandise value (GMV) of the products sold on its platform, but the US retailer is already said to be in the lead in terms of the total number of stock keeping units (SKUs) sold. Both firms say they’re in it for the long haul to grow India’s nascent e-commerce market, a fight that could absorb many more billions of dollars before a victor emerges.