Indiaplaza said to be eyeing funds from VCs

Indiaplaza.in, among the top e-commerce retailers in India, is understood to be readying itself to embark on a round of fund-raising in the near future. The company in which the Indigo Monsoon Group is a majority investor, is said to be going through the process of due diligence from a few venture capital funds.

According to investment bankers close to the deal, Indiaplaza.in may raise as much as $10 million in this round.

A couple of other bankers who are in the know further added that there may be some strategic interest in the company and global names including Amazon.com are being talked about. The management of Indiaplaza.in declined to comment.

During early 2007, Fabmall.com acquired US-based Indiaplaza.com, among the top e-commerce destination for Indians in USA.

After this, the combined entity was operational under Indiaplaza. The Indigo Monsoon Group (IMG) is an investment firm that focuses on early stage internet, mobile and technology start-ups either located in India or targeting Indians, was an investor in Indiaplaza and post-takeover, went on to hold a majority stake in the combined firm.

Prior to this step of taking over Indiaplaza.com, Fabmall.com was pioneered by two IT honchos from Wipro sta-bles — V S Sudhakar and K Vaitheeswaran.

Indiaplaza.in, houses around 8 million products, has 1.5 million customers and is looking to scale upto half a million transactions in a year during the next year from the current quarter a million as of now.

According to industry information, the gross value of products sold on this marketplace is around $20 million, with electronics and books accounting for the majority of this.

The Indian retail e-commerce market is worth around Rs 2,000 crore (excluding the travel booking) and is growing at a rapid pace and Indiaplaza.in was among the early movers in this market.

Even as e-commerce market is on a high growth path, another aspect of m-commerce is also latching with the penetration of mobile phones on a sharp upward curve than the PC penetration in India.

Many e-commerce portals and marketplaces are putting in mechasims to enable m-commerce with active co-operation from various financial institutions. However, according to industry analysts, the area of concern is the aspect of security which is among the major hurdles for further growth of this sector.