Amazon and
Walmart Stores Inc will invest over $300 Mn (INR 2,000 Cr) in a bid to build their network and to gain a share in the
Indian retail market.
The two of the world’s largest retailers are planning to gain a commanding position by building scale through deep discounting in the Indian retail market, which is expected to cross $1 Tn by 2020.
Amazon will inject Rs 1,696 crore through a rights issue into Amazon Seller Services, making it the biggest infusion of capital since entering the country three years ago. The board resolution to this effect was filed with the Registrar of Companies on Thursday. The investment takes Amazon's total investment in Amazon Seller Services in the past year to aboutRs 4,800 crore.
Walmart Stores will invest Rs 360 crore, it said in an RoC filing on Wednesday. It plans to open nearly 50 doors in India at a time when it plans to close nearly 270 stores globally.
India's
ecommerce market is expected to grow to $103 billion by FY20 from $26 billion, according to
Goldman Sachs. Amazon expects India to overtake Japan, Germany and the UK to become its largest overseas market, besides becoming the quickest to reach $10 billion in gross merchandise value in the company's history, Diego Piacentini, senior vice-president for international business, had told ET in October last year. ET reported in July last year that Amazon may invest about $5 billion in India, up from $2 billion pledged previously by chief executive officer Jeff Bezos. Rivals Flipkart and Snapdeal have meanwhile raised funding from overseas investors as they seek to strengthen their own positions.
