Flipkart Internet, the online marketplace arm of the e-commerce giant, has received an over ₹3,462-crore fund infusion from Flipkart Marketplace, Singapore, PTI reported on Wednesday.
The fresh fund infusion, made in two tranches, will help Walmart-backed Flipkart take on U.S.-based Amazon for leadership in India’s growing e-commerce market.
“...in accordance with the Letter of Offer dated 14 August, 2018 circulated by the company for the rights issue of shares, the board of directors of the company be and hereby allot 14,57,598 Class A equity shares...for an amount aggregating to ₹30,07,02,46,740 for cash to Flipkart Marketplace Private Ltd, Singapore,” PTI quoted regulatory documents filed with the Corporate Affairs Ministry as saying.
The fresh capital comes ahead of the festive sale season and Flipkart’s Billion Day Sale in October when it offers massive discounts to customers. Both Flipkart and Amazon, locked in battle for the Indian e-commerce market, are leaving no stone unturned to woo customers ahead of the festival sales.
Sales of online retailers are expected to nearly double to a whopping $2.5 billion to $3 billion during the five-day festive season this year from $1.5 billion last year, according to a report by Redseer Consulting, an Internet-focussed consulting firm. The number of shoppers is also expected to leap to 20 million from last year’s 13-14 million with the focus on attracting buyers from tier II cities.
Earlier this year, the world’s largest retailer, Walmart Inc, bought a majority stake in Flipkart for $16 billion, heating up the online retail battle in India. Amazon has infused Rs 2,600 crore into its Indian unit, doubling Amazon India’s authorised capital to $4.74 billion.
Mint reported this week that Flipkart was in talks to buy a stake in Star India’s video streaming service Hotstar, a move that would take the battle between the e-commerce firms into video content.
Reuters reported that a Hotstar representative denied any such talks with Flipkart, but said it was open to partnerships that can help grow the Internet ecosystem in India and beyond.