Singapore-based Flipkart Private Limited has invested Rs 1,431 crore in its Indian wholesale business Flipkart India, as per filings with the Registrar of Companies sourced by data intelligence platform Paper.vc. The new round from the parent company comes just around a month after it poured Rs 2,190 crore in December 2018.
The current round of funding was made on January 7 as per the filings.
4.86 lakh equity shares were allotted based on the “resolutions passed by the board of directors of Flipkart India Private Limited at their meeting held on January 7, 2019,” the documents showed.
Post Flipkart’s acquisition by Walmart that was completed in August last year, Flipkart Internet, the online marketplace vertical arm has raised Rs 3,462 crore from Singapore-based Flipkart Marketplace.
The new round takes Flipkart’s total capital infusion into its India business to Rs 7,083 crore after the Walmart deal. In March last year as well, the Flipkart had infused Rs a massive round of Rs 4,472 crore in Flipkart India.
Email sent to Flipkart over the amount raised didn’t elicit a response.
Flipkart India and Amazon’s wholesale unit as well – Amazon Wholesale India Private Limited source goods directly from manufacturers and then sell them to third-party sellers which in-turn sell them to consumers via their marketplace platforms, that is, Flipkart Internet and Amazon Seller Services.
Amazon Seller Services’ losses went up by 30% to Rs 6,287 for FY2018 even as operating revenues shot up by 57% to Rs 4,928 crore, based on the RoC documents. Even with a continued increase in losses, Amazon saw faster growth in revenues at 54% to Rs 5,018 crore in FY18 against 43% growth in the previous year.
In contrast, Flipkart Internet narrowed its consolidated losses to Rs 1,160 crore for the same year. Flipkart’s revenue stood at Rs 2,790 crore for 2017-18.
The two e-commerce giants have reportedly sought the extension of the February 1 deadline, to comply with the revised FDI rules in e-commerce to come into effect, from the government.
According to experts, e-commerce companies having FDI including Amazon and Flipkart will now have to look for ways to restructure their businesses so as to obviate the curbs on selling products of companies in which they have an equity stake.
“Time has come to look at franchise channels, rather than equity investments channels to do business in India,” EY India’s national leader for policy advisory & speciality services told FE earlier.