Your browser is currently blocking notification.
Please follow this instruction to subscribe:
X
Notifications are already enabled.
X

Flipkart Receives $200.8 Mn Investment From Its Parent Co

Flipkart Receives $200.8 Mn Investment From Its Parent Co

Only a month back, Flipkart had received $307.5 Mn from its parent entity

Prior to that, it had received $486 Mn funding

Its rival, Amazon, too is fiercely investing in its India arm

The wholesale arm of the Walmart-owned Flipkart — Flipkart India Private Ltd — has received an investment of $200.8 Mn (INR 1,431 Cr) from its Singapore-based parent entity, Flipkart Private Limited.

Only a month back, Flipkart received INR 2,190 Cr ($307.5 Mn) from its parent entity. In September last year, the entity had invested INR 3,463 Cr ($486 Mn), and INR 4,472 Cr ($686 Mn) in March, in its India arm.

The recent investment to Flipkart comes a month after the India government issued a notification that mandates ecommerce companies to refrain from exercising ownership or control over the seller’s inventory.

Flipkart, along with its main rival Amazon, usually purchases goods in bulk from manufacturers and sells them to online vendors registered to their platform. The new policy restricts online marketplaces from procuring over 25% of the inventory from a single vendor in which they own a stake.

The Indian government issued a notification on December 26, 2018, after making changes in the Consolidated FDI Policy Circular 2017, that also restricts online marketplaces from influencing the sale price of products, or resorting to deep discounting practices.

The policy is set to come into effect from February 1 onwards, for which Amazon and Flipkart have pleaded the government for an extension of the deadline.

With the latest investment, Flipkart’s parent entity has been issued 4.86 lakh shares in Flipkart India at a price of INR 29,400 ($412.7) per share, according to the company’s filing with the Registrar of Companies, accessed by Inc42.

On the other hand, US multinational ecommerce company Amazon, too, is active in strengthening its India arm. Till now Amazon India has received close to $5 Bn (INR 35,255 Cr) funding from its US-based parent company. Last year in December, Amazon fueled INR 2,200 Cr ($309 Mn) in its India arm.

The competition between Flipkart and Amazon is growing fiercer. The changes in the recent FDI policy, which is aimed to create a level playing field for ecommerce sellers, has only bolstered the resolve of these two behemoths to dominate India’s ecommerce sector at any cost.

Author

Dipen Pradhan

Inc42 Staff
Responses
https://inc42.com/buzz/blockchain-this-week-the-case-for-centralisation-blockchain-jobs-mexican-narcos-and-more/
Loading Next…

Upcoming Events

  • Morning Pitch

    Organiser - Deloitte Jap…
    10 AM to 12 PM
    New Delhi, Delhi