US online retail giant Amazon has invested Rs 6,200 crore (about $1 billion) in its e-commerce business in India since the beginning of this calendar year as it competes with its rival Flipkart.
Amazon Seller Services has done three rounds of capital infusion this year so far at various intervals. The largest among them, Rs 2,900 crore, was made at the end of September, according to official reports.
This brings the total pumped into this arm to Rs 17,839 crore. The figure shows how quickly Amazon has winded up its investment in Indian e-commerce, with $1 billion of that being invested in 2017. The firm has also seen its authorised capital rise from Rs 16,000 crore to Rs 31,000 crore, which could signal the coming in of a lot more investment. Amazon aims to overtake Flipkart, which claims to have a cash reserve of $4 billion.
Globally, Amazon reported that its international losses soared to $936 million in the three months that ended September, largely on account of its investment in India. It did not give the exact figures for India but documents filed with the registrar of companies reveal two investments in September amounting to Rs 4,520 crore ($700 million) in Seller Services.
Amazon is also heavily investing here in its cloud computing division, its information technology services unit (oldest one in the country) and more recently in its payments arm. Late last year, Amazon put Rs 1,381 crore into Amazon Data Services and has also invested Rs 382 crore in Amazon Pay (India). Earlier this year, the firm also got a green light from the government for investing $515 million in multibrand ‘food-only’ retailing.
These increased investments come at a time when rival Flipkart has raised $3.9 billion in two funding rounds, from SoftBank, Tencent and Microsoft earlier this year. The company says its cash pile of $4 billion will be used to counter the growth of global rivals in the country.
Paytm, which runs its own e-commerce platform, got a massive $1.4 billion from SoftBank earlier this year. The company’s largest investor is Alibaba, biggest global rival for Amazon in the e-commerce business.
Amazon’s global chief, Jeff Bezos, has committed to investing $5 billion in e-commerce in India, and their India head, Amit Aggarwal, has on numerous occasions said the company won’t limit its investment to that figure. However, with India beginning to suck an ever larger portion of Amazon’s global earnings, it’s a matter of time before investors begin asking for investment detail numbers.
Source: Business Standard