Ahead of the festive sale, Amazon pumps Rs 1,125 crore into its India unit

Topics Festive sale | Amazon | Flipkart

The infusion was done by allotting 1,125 mn shares of ~10 each to the investors
Amazon has invested Rs 1,125 crore into its India marketplace unit. The infusion would help the e-commerce giant take on its rivals, including Walmart-owned Flipkart and Reliance’s JioMart, in the upcoming festive season.

The company’s online marketplace arm, Amazon Seller Services Private Limited, has received the infusion from Amazon Corporate Holdings Private Limited, Singapore and Amazon.com Inc Limited, Mauritius, according to the documents filed by Amazon, which were sourced from business intelligence platform Tofler. The infusion was done by allotting 1125 million equity shares to the investors at a nominal amount per share of Rs 10.

According to analysts, this may be the third infusion of Amazon for 2020 in India. Normally, there is at least a four-month gap between infusions, but the latest infusion has come much faster, given that India unit raised $307 million in the first week of July, according to the analysts at the business intelligence platform Paper.vc.

“We estimate that post this transaction, their total funds infused into Indian operations for 2020 have reached a little over $750 million. The company received $1.26 billion and $826 billion in FDI (foreign direct investment) in 2018 and 2019 respectively,” said an analyst at Paper.vc. “With the Diwali season around the corner and the retail battle heating up with Reliance’s entry, it is likely that they may make another infusion very soon,” he added.

This month, Amazon and private equity firm Samara Capital also jointly invested over Rs 275 crore in Witzig Advisory Services, holding firm of the More supermarket chain.

Amazon India is hosting its flagship sale event  ‘Great Indian Festival’ and its rival is conducting Big Billion Days (BBD) next month to tap the festive season.  The e-commerce festive sales could alone cross the $7-billion mark in the whole season.

Amazon has built significant augmentation in its delivery network. The company has added close to 200 delivery stations, including those operated by ‘delivery service partners’ across the country, to further its direct reach including Northeastern towns such as Champhai, Kolasib, Lumding and Mokokchung.

The firm has also strengthened its delivery programmes as well with its flagship ‘I Have Space’ (IHS) programme. It now comprises more than 28,000 neighbourhood stores and kiranas in close to 350 cities.


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