Parent company reduces equity infusion in Flipkart’s marketplace, tightens cash by 70%

Business
Oct 04 2016 12:11 PM
Trainee_tripti

Parent company reduces equity infusion in Flipkart’s marketplace, tightens cash by 70%

Flipkart, the Singapore-based parent of India's online retail giant has reduced investment into the marketplace unit by almost 70% in the year ended March, efficiently warning the firm’s sales during the given time period.

Flipkart Marketplace has received equity infusion of Rs 1,629 crore in fiscal 2016 that is considered lower than the Rs 5,456 crore, which it secured in the previous year. These findings are shown by Singapore government filings closely accessed by Economic Times.

Contrasting with the reduced asset into Flipkart's e-commerce business, Amazon Seller Services- the US based Amazon's main India unit, received capital infusion of Rs 7,463 crore in fiscal 2016, up from Rs 1,888 crore in the previous year.

Both the companies have relied on investment part heavily so that the sales growth can be driven smoothly making use of the cash properly to lure customers with massive discounts.

In its 8 years of emergence, Flipkart has been able to raise $3.2 billion (Rs 21,500 crore) taking the lead whereas Amazon is aggressively catching up.

Flipkart's gross sales remained sluggish between $3.5 billion-$4 billion before inching back to $4.5 billion-$5 billion in recent months.

Both e-commerce giants Flipkart and Amazon have their companies registered in India that run their business across logistics, wholesale and payments. These units get their capital infusion from investment holding companies which are registered overseas.

Flipkart's and Amazon have combined sales that trebled to Rs 10,390 crore on that year, with Flipkart India accounting for over 90% of the sales. Financial statistics for the year ended March 2016 are yet to be filed.

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