Amazon invested $1 billion in India e-com arm since January CAPITAL INFUSION
US online retail giant Amazon has invested ~6,200 crore (about $1 billion) in its e-commerce business in India since the beginning of this calendar year as it competes with cashflush rival Flipkart.
Amazon Seller Services, largest arm of the US company here, has seen three rounds of capital infusion this year. The largest, of ~2,900 crore, was at end-September, according to official filings.
This brings the total pumped into this arm to ~17,839 crore ($2.7 billion). The figure shows how quickly Amazon has ramped 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 ~16,000 crore to ~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 The authorised capital of the e-com unit was raised to ~31,000 crore from ~16,000 crore The firm has also invested in other units such as payments, IT and cloud services Flipkart raised $3.9 bn in two rounds from Softbank, Tencent & Microsoft this year for India but documents filed with the registrar of companies reveal two investments in September amounting to ~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 ~1,381 crore into Amazon Data Services and has also invested ~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.