Amazon infuses another Rs 2,700 cr in Indian operations
Published: Aug 16, 2018
By TIOLCORPLAWS News Service
BENGALURU, AUGUST 16, 2018: The world's largest online retailer, Amazon has invested an additional Rs 2,700 cr in its Indian unit, bringing its total investment in India to roughly USD 4 bn in the five years that it has operated in the country, even as it continues to battle local rival and market leader Flipkart. Amazon, which had committed to invest at least USD 5 bn in India and also separately allocated an additional USD 500 mn to build out its food retail business in India, simultaneously pumped in about Rs 100 cr into the business.
According to regulatory documents filed with the Registrar of Companies, the Amazon Seller Services, the marketplace arm of Amazon India, received the funds earlier this month. So far, Amazon had been spending all its cash on building massive warehouses, a large logistics unit, marketing, discounts and increasing product assortment.
In June 2016, Amazon had said it would invest an additional USD 3 bn in India after the company exhausted its earlier investment pledge of USD 2 bn made in 2014. Amazon is currently the No. 2 player in India's online retail market.
Both Amazon and Flipkart are expected to spend hundreds of millions of dollars towards expansion over the next few years. For both companies, sales growth is a much bigger priority than cutting losses and analysts say that they are nowhere near profitability.