Amazon infuses Rs 1,125Cr into India unit ahead of festive sales, to take on Reliance's JioMart, Flipkart
In June 2020, Amazon pumped fresh capital to the tune of Rs 2,310 crore into Amazon Seller Services. In January, Founder Jeff Bezos announced over Rs 7,000 crore investment in India to help bring small and medium businesses online.
Amazon, the Seattle-based ecommerce giant, has infused fresh capital to the tune of Rs 1,125 crore into one of its India units — Amazon Seller Services — according to regulatory documents.
The fresh infusion will provide more ammunition to Amazon to compete aggressively against Walmart-owned and billionaire Mukesh Ambani-run Reliance Industries' JioMart in the upcoming festive season.
Amazon Corporate Holdings Private Limited, Singapore, and Amazon.com Inc Limited, Mauritius, have pumped in Rs 1,125 crore into Amazon Seller Services, regulatory documents sourced by business intelligence platform Tofler showed.
Amazon Seller Services allotted equity shares to these entities for the said transaction on September 17, 2020.
Amazon did not respond to queries.
In June this year, it had pumped in fresh capital to the tune of Rs 2,310 crore into Amazon Seller Services. In January, Founder Jeff Bezos had announced $1 billion (over Rs 7,000 crore) investment in India to help bring small and medium businesses online. Previously, the online retail giant had committed $5.5 billion investments in India, one of Amazon's most important markets outside of the US, and a key growth driver.
Amazon rival Flipkart had announced raising $1.2 billion funding led by parent Walmart in July — which valued the ecommerce company at $24.9 billion.
Interestingly, Reliance Industries — which had announced the acquisition of Future's retail, wholesale, logistics, and warehousing units for Rs 24,713 crore last month — is also bolstering its operations ahead of the festive season.
Earlier this month, RIL's retail arm — Reliance Retail Ventures Ltd — had said US private equity firm Silver Lake Partners will buy 1.75 percent stake for Rs 7,500 crore.
Reliance Chairman Mukesh Ambani
Reliance Retail's network includes supermarkets, consumer electronics chain stores, cash and carry wholesale business, fast-fashion outlets, and online grocery store JioMart — spanning almost 12,000 stores in nearly 7,000 towns. In May, Reliance launched an online grocery delivery service, JioMart, and had tied up with WhatsApp to connect customers with local kirana stores.
Ecommerce companies see a large chunk of their business coming in during the festive sales, and they make significant investments ahead of time to ramp up their capacity to be able to handle the spike in orders.
As per a report by , festive sales are expected to almost double this year and touch $7 billion in gross merchandise value (GMV) as compared to $3.8 billion in the same period last year.
GMV is a term used in online retailing to indicate the gross merchandise value of products sold through the marketplace over a certain period.
Edited by Suman Singh