The ecommerce game is becoming a high stakes battle, big time. If Flipkart was rejoicing on account of its replenished coffers to the tune of $4 Bn thanks to SoftBank, Tencent, eBay and Microsoft, Amazon India has cut its happiness short. The ecommerce giant has almost doubled its authorized capital to $4.74 Bn (INR 31,000 Cr), matching its earlier capital commitment of $5 Bn made in June last year.
As per the regulatory filings with the Registrar of Companies, Amazon India has already issued paid up capital of $2.7 Bn (INR 17,839 Cr) towards its marketplace arm Amazon Seller Services. This exceeds the initial commitment of $2 Bn in July 2014.
The latest move by Amazon indicates that the company is more than willing to match or outnumber Flipkart’s funding war chest to take it head on in India, one of world’s last major consumer Internet market.
Amazon India, Flipkart, And The High Stake Ecommerce War
The funding commitment closely follows remarks made by Amazon Worldwide Consumer CEO Jeff Wilke that Amazon is not bothered by the huge losses the ecommerce company faced in the international markets including India in the last quarter. For the quarter ending on September 30, 2017, the ecommerce giant reported a loss of $936 Mn in the international markets, owing to its aggressive investments in India.
Wilke believes India to be the fastest growing market and they will continue investing aggressively even if it will take time to mature. Further, hitting hard on the said rivalry talks with Amazon India’s arch nemesis Flipkart, Amazon Worldwide Consumer CEO clearly stated, that he is not at all bothered with the increased $4 Bn war chest of Flipkart.
“One of our leadership principles is customer obsession, and we don’t spend time thinking about competitors. We promised in 2014 that we will invest $2 Bn (in the India business) and then in 2016, another $3 Bn. We are on track to invest all that money. We are investing because we like the return that we are seeing in terms of growth and we like the inventions on behalf of sellers and customers,” he said in an interaction with an English daily.