It was in the year 2013 that global leader Amazon made an entry into the growing e-commerce Indian market that was mainly dominated by homegrown e-tailers Flipkart and Snapdeal.
It was in the year 2013 that global leader Amazon first made an entry into the briskly growing e-commerce Indian market that was mainly dominated by homegrown e-tailers Flipkart and Snapdeal. Since then the global giant has invested over $2 billion in the country, according to official filings. Soon after Amazon’s entry in India, domestic e-tailer Flipkart started consolidating the market. The company acquired online fashion retailer Myntra in an estimated Rs 2,000 crore deal in the year 2014. After two years, Flipkart-owned Myntra acquired Jabong from Global Fashion Group for $70 million.
Flipkart even tried to take over rival Snapdeal but negotiations ended after tumultuous discussions stretched over seven months. With time, the competition grew more fierce and a price war escalated between the leading players putting pressure on the finances of the companies. Flipkart’s accumulated loss as of March 2017 stood at Rs 24,000 crore, according to a filing on Singapore exchanges. The losses of the company more than doubled to Rs 24,000 from Rs 10,000 a year ago period.
Amazon-Flipkart takeover talks
Earlier in the day, there were news reports that Amazon is planning to offer rival bid to Walmart in order to acquire stakes in Flipkart. However, it’s not the first time that such reports have appeared. Back in 2015, various news reports stated that Amazon had offered $8 billion to Flipkart. Out of the entire amount, $5 billion were offered for e-tailer’s e-commerce business and $3 billion for the logistics business. The deal couldn’t materialise on the valuation issue, news reports said. However, Flipkart rubbished the reports at that point in time.
In 2018, the Indian e-commerce market is slated to surpass $50 billion.
According to the latest earnings report, Amazon’s global business recorded losses in the first nine months of 2017. The losses from its global operations widened to $919 million for the December 2017 quarter, the report said.