Amazon India is going aggressive to topple Flipkart, gets Rs 2000 crore investment

Amazon India has received an investment of Rs 2,010 crore from its parent company Amazon. This marks the single largest capital infusion so far as it bids to topple market leader Flipkart from its perch atop one of the world's fastest-growing markets for online retail.

According to regulatory filings, this latest investment, made in November, takes the total capital invested in Amazon Seller Services to over Rs 7,000 crore in the last 12 months.

The Jeff Bezos-owned company, which operates the online marketplace Amazon. in, is estimated to have lost over Rs 1,000 crore to woo customers with special offers and discounts in the festive season in October, according to two people aware of the details.

"It is losing about Rs 600 crore every month (non-sale months)," one of the sources, told ET.

He reckons the Seattle-based company will burn up nearly a $1billion this year in India as it races to outpace its Indian rivals.

"We will invest what it takes to become the customers' preferred choice in India, and are encouraged that we are India's largest and fastest-growing ecommerce marketplace. In an industry reportedly flat or negative, Amazon India has continued to show remarkable growth of over 100% this year," an Amazon India spokeswoman in told ET.

Recently, Flipkart cofounder Sachin Bansal and ride-hailing app Ola's cofounder Bhavish Aggarwal have been at the forefront of a debate after they said Indian-origin startups need policy support to counter what they claim is "capital dumping" by foreign rivals.

The aggressive spending has started showing some results. Amazon Seller Services' turnover for the last fiscal rose 116% to Rs 2,217 crore. In the same period Flipkart Internet's sales increased 153% to Rs 1,952 crore. However, these figures don't include the revenue of Flipkart's fashion subsidiary Myntra. Both Amazon Sellers Services and Flipkart Internet earn revenue through commissions, advertisements and shipping fees that they charge sellers.