WS Retail, the largest seller on e-commerce
marketplace Flipkart, posted a 33 per cent growth in revenues at Rs 13,921 crore for the year that ended March 2016, or nearly three times that of rival Amazon's largest Cloudtail which reported a revenue of Rs 4,591 crore during the same period.
While its revenues make it the single largest retailer in India, beating even offline retail giants such as Shoppers Stop, Tata Trent and Reliance Retail, profits for the financial year stood at a paltry Rs 5.21 crore. WS Retail
had reported a revenue of Rs 10,485 crore in the previous financial year, with a profit of Rs 84.6 lakhs.
"The profit of the company has increased more than six times which is mainly the result of efforts of the management to increase the revenue and reduce the expenses incurred by the company," read the regulatory filings, sourced from data firm Tofler.
Internet and Instakart Services) posted a combined revenue of Rs 15,440 crore during financial year 15-16, suggesting that bulk of the company's sales
were driven by WS Retail.
While the Flipkart
Bansals had sold their stake in WS Retail
to Rajeev Kuchhal, chief executive officer of OnMobile along with a clutch of investors a few years ago, it is believed that the company is still affiliated to Flipkart
via holding companies in Singapore.
In April, the government allowed e-commerce
companies to attract 100 per cent foreign direct investments but stipulated that no single vendor could account for more than 25 per cent sales
(in terms of value) on any single platform. In the current financial year, it is expected that revenues of WS Retail
will drop sharply as Flipkart
moves to remain compliant with the law.
has moved to prop up multiple sellers similar to WS Retail
in order to navigate the FDI norms. In July last year, Business Standard reported that the company would work with a clutch of 50-60 large sellers that would make up the bulk of its sales. The model is similar to Chinese e-commerce
giant Alibaba, where 20 per cent of the sellers contribute 80 per cent of the company's sales.