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Amazon injects Rs 1,660 cr into its Indian marketplace unit
Photo Courtesy: Unsplash

Amazon injects Rs 1,660 cr into its Indian marketplace unit

| @indiablooms | 14 May 2024, 05:06 pm

Mumbai: Amazon Seller Services' US parent company has injected a new equity investment of Rs 1,660 crore ($199 million) into the firm that operates Amazon's marketplace in India, according to a regulatory filing.

As a result of this capital infusion, the Indian entity issued 1.66 billion equity shares, each valued at Rs 10, to Amazon Corporate Holdings Ltd and Amazon.com, Inc, as per the April 15 filing by Amazon Seller Services.

This latest development is in line with Amazon's ongoing commitment to India, coming after investments exceeding Rs 1,000 crore in its local entities earlier this year.

In February, the marketplace entity received Rs 830 crore, and in January, Amazon invested Rs 350 crore in the entity managing its fintech unit, Amazon Pay.

Amazon’s biggest competitors in India, Flipkart and Meesho, are also securing fresh capital for their local operations.

In January, Flipkart received about Rs 924 crore in two installments from its Singapore-based affiliates.

Last December, it was reported that Flipkart is negotiating to raise up to $1 billion, with Walmart, its parent company, pledging $600 million.

Meesho recently completed a $275 million funding round, which included both primary and secondary share sales, as reported on May 11.

This is the initial portion of a larger $600 million funding round that the Bengaluru-based company is targeting.

In response to the competitive market, Amazon India launched a new segment called Amazon Bazaar, offering low-priced, unbranded fashion and lifestyle products, as reported in February.

This move aims to compete with Meesho in the budget e-commerce sector, which also includes Flipkart-owned Shopsy.

Furthermore, Reliance Industries is developing a similar platform named Ajio Street.

Amazon has been increasingly prioritizing its cloud services division, Amazon Web Services, over its core e-commerce business.

In June of last year, CEO Andy Jassy announced plans to invest an additional $15 billion in the Indian market, raising Amazon's total investment in the country to over $26 billion by 2030.

For the financial year ending March 31, 2023, Amazon Seller Services reported a 3.4% increase in revenue, reaching Rs 22,198 crore.

However, the company's net loss expanded by approximately one-third to Rs 4,854 crore, according to the most recent data available.

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