Amazon India to host online sales event for SMEs

The Indian arm of global e-tail major Amazon will host 'Small Business Day' online shopping event on December 16 to promote small and mid-size enterprises (SMEs) and micro entrepreneurs in the country, the company said on Monday.

"Through the event, we aim to promote small businesses and micro entrepreneurs and encourage shoppers to discover and buy products directly offered by them," Amazon India said in a statement here.

The one-day online sale, starting from the midnight of December 16, is expected to see the participation of thousands of small business owners from across the country, Amazon said.

The company, which claimed the event to be the first-of-its-kind online sale dedicated for small businesses in the country, however, did not disclose the exact number of sellers to be part of the online sales event.

In a bid to encourage the SMEs, the e-commerce major will offer products from various small sellers at special prices and cashbacks for buyers, the statement said.

"The event will help customers to purchase products from micro entrepreneurs and thus support local employment," it added.

"This initiative will bring small and micro sellers and customers together to boost India's local economy," said the director of Amazon India Seller Services, Gopal Pillai, in the statement.

Flipkart conducts first major management reshuffle since Walmart buyout

In the first significant management reshuffle since Walmart Inc. bought a majority stake in Flipkart, several top and mid-level executives have been moved to a number of new roles, while other leaders have been moved from Flipkart to Myntra and vice versa, as Flipkart chief executive officer (CEO) Kalyan Krishnamurthy looks to place key lieutenants across critical business units.

Since the end of the key Diwali season sale, Flipkart has moved a number of senior managers to new roles, as Krishnamurthy looks to tighten the e-commerce firm’s performance across all units and reduce Flipkart’s reliance on smartphones, which still generates well over 50% of Flipkart’s overall sales.

Flipkart has moved large appliances head Sandeep Karwa to work on the company’s new hyperlocal offering, which rolls into the overall grocery business.

Hari Kumar, a senior director who has held a number of different roles within Flipkart over the past few years, has been tasked to head the large appliances business.

More significantly, Flipkart has appointed Aditya Soni as the new head of its flagship smartphones business, after former smartphones head Ayyappan R. was moved to Myntra.

Smrithi Ravichandran, a senior director who used to head key events like Big Billion Days, merchandise and business developments, has been moved to a new role in Flipkart’s fintech unit. Ravichandran’s position has been taken over by Nandita Sinha, who used to head Flipkart’s home and furniture business, the people mentioned above said. Flipkart is expected to appoint a new head for the furniture business over the coming weeks.

Flipkart has also moved key executives like Ayyappan to Myntra, while some top leaders from Myntra are expected to be moved to Flipkart. For instance, according to the first two people mentioned above, Myntra’s current chief technology officer Jeyandran Venugopal is expected to be moved to Flipkart in a new role after Myntra’s flagship End of Reason Sale, which is usually held in December-January.

A Flipkart spokesperson declined to comment on these changes.

The past few weeks and months have witnessed massive changes at Flipkart. Most significantly, Flipkart co-founder Binny Bansal was forced to resign, after an internal investigation carried out by Walmart and Flipkart into an allegation of “personal misconduct” on the part of Binny Bansal. The investigation did not find any evidence of wrongdoing to support the allegation, but revealed a “lapse in judgement” from Binny Bansal, according to Walmart.

Following Bansal’s departure, Flipkart also elevated Krishnamurthy to a broader group-level role and made Myntra report into him, after keeping the online fashion retailer independent since acquiring it in 2014. Krishnamurthy later clarified that Myntra will continue to remain an independent business.

Mint reported on 16 November that Flipkart may abolish the position of group CEO and retain the new structure it put in place after Binny Bansal’s exit. Following that, a large round of layoffs was also carried out at Jabong, as part of a broader integration between Myntra and Jabong, as Mint reported on 16 November. About 150-200 employees have been laid off, as part of the restructuring, although Myntra CEO Ananth Narayanan later told Mint that about 10% of the combined workforce of Myntra and Jabong would be cut.

Quikr raises ₹55 crore debt from InnoVen to grow ops

Quikr India Pvt. Ltd, which runs an online classifieds and services portal, has raised ₹55 crore in debt financing from Temasek-owned InnoVen Capital to grow its operations. It follows the ₹130 crore venture debt that Quikr raised in 2016 from Brand Capital, the private treaty arm of media conglomerate Bennett, Coleman and Co. Ltd (BCCL). “As a business, we continuously look to optimise our capital structure and saw a very good fit in venture debt to support growth of our transaction businesses,” said Rahul Tewari, Quikr’s chief financial officer, in a statement on Friday.

Quikr has also raised over $350 million so far in equity fundingfrom Warburg Pincus, Matrix Partners, Norwest Venture Partners, eBay, Nokia Growth Partners and AB Kinnevik among others. It is in talks to raise between $100-$150 million from new and existing investors by keeping its record valuation of $1 billion, Mint reported in September.

Quikr faces tough competition from Olx Inc., owned by South African media and e-commerce company Naspers Ltd.

Swedish investor, AB Kinnevik, which holds an 18% stake in Quikr, had cut the fair valuation of its holding in Quikr by 12% as of December 2017, reducing the company’s overall valuation to $935 million. The investor however marked up its holding by 16% to about $178 million in the period ended 30 June 2018, implying a total valuation of about $1.03 billion for Quikr.

Tiger Global-backed Quikr operates in segments such as real estate, auto, jobs, goods and services.

Real estate is among the highest revenue generating segments across its five verticals, Quikr chief executive Pranay Chulet said in a telephone interview earlier this month.

The various businesses of Quikr have recorded robust growth for the year through March 2018.

Real estate segment surged 105%, used cars and bikes 115%, goods 90%, Quikrjobs 90% and QuikrEasy 80%. The company also plans to expand its financial services business, the most recent of its businesses, Chulet had said. Quikr cut its losses by 28% to ₹231.2 crore in the last fiscal year. Revenue climbed 52% to ₹199.98 crore.

Quikr had been on an acquisition spree since 2015 and has acquired 13 companies so far across categories. These contribute nearly 55% of Quikr’s total revenue, said Chulet.

The company had sought to grow through acquisitions and create a diverse range of businesses.

It is also aiming to double revenue in this fiscal year to ₹350 crore.

“The company has showcased strong momentum, with improving unit economics and is positioned well to harness the benefits of scale and large customer base,” said Aashish Sharma, chief executive of InnoVen Capital.

Several startups are opting for venture debt capital as against traditional equity funding. InnoVen Capital, one of the biggest venture debt firms in India, has closed more than 40 deals during the year, said Sharma by telephone.

Mumbai-based InnoVen counts unicorn firms including Oyo Rooms (Oravel Stays Pvt. Ltd), Swiggy (Bundle Technologies Pvt. Ltd) and Byjus (Think and Learn Pvt. Ltd) among others as its portfolio companies. InnoVen has seen 25-30% annual growth rate in investments this year, Sharma added.

Quikr’s acquisitions, however, have not worked out as well as the company had expected. Like many other online businesses, Quikr struggled to translate traffic on the platform and focussed on cutting costs and expanding businesses that are losing less money. Chulet had earlier claimed that the cash burn has reduced by 40-50% over time.

Naspers Rides High On India Portfolio With PayU Performance, Flipkart Stake Sale

PayU India accounts for more than half the overall business of PayU

Naspers continues to build a broader credit platform in India

Gained a 29% return on Flipkart sale, invested an additional $79 Mn in Swiggy

PayU India accounted for more than half the overall business of Netherlands-based PayU, the payments arm of tech investor Naspers.

According to the half-yearly financial statement of Naspers, for the period ending September 2018, the company said, “PayU recorded strong growth in its core (payment service provider) business.”

The financial report for H1 FY19 reported a 35% increase in the number of transactions processed, to over 400 Mn, generating a total payment transaction value exceeding $14 Bn (INR 99,071 Cr) on the PayU platform. Overall, the business delivered revenue growth of 36% to $171 Mn (INR 1,210 Cr).

Earlier, in September 2018, PayU India also received approval from the Reserve Bank of India (RBI) to operate its own non-bank financial company (NBFC), which is subject to certain pending RBI compliance.

Naspers is growing well in the fintech segment globally. In India, its flagship product LazyPay gained significant traction, reaching over 450K consumers and issuing more than $4 Mn (INR 28.3 Cr) in loans per month. For the uninitiated, LazyPay was the consumer brand of Indian fintech company Citrus Pay, which Naspers acquired in September 2016 for $130 Mn (INR 919.9 Cr).

Further, its investments in Indian credit-portfolio companies also continued to perform ahead of its expectations. PaySense and ZestMoney each issued over $7 Mn (INR 49.5 Cr) in loans per month. According to Naspers’ financial report, in July 2018 the group invested an additional $12 Mn (INR 84.91 Cr) in PaySense and now holds a 19% effective interest (17% fully diluted) in the company.

“In India, we continue to build a broader credit platform, which is supporting encouraging progress across all our initiatives. We merged Europe, Middle East and Asia (EMEA) and Latin American businesses, realising significant efficiencies and cost reductions. Revenue scaling, coupled with cost compression, enabled us to substantially improve profitability in the segment,” the report added.

The South Africa-based internet and media company also gained a 29% return (at internal annual return rate) on its investment in Indian ecommerce unicorn Flipkart by selling its 12% stake to US retailer Walmart for $2.2 Bn (INR 15,568.3 Cr). It is now looking to solidify its investments in startups that are operating in the food delivery, classifieds, and fintech segments in India.

“The group invested an additional $79 Mn (INR 559 Cr) in Bundl Technologies Private Limited (Swiggy), an online food ordering and delivery platform in India, during July 2018. Following the investment, the group holds a 25% effective interest (23% fully diluted) in Swiggy,” the report mentioned.

Swiggy raised two big rounds of funding this year including:

• $210 Mn (INR 1,486 Cr) Series G led by existing investor Naspers and new investor DST Global (June 2018)
• $100 Mn (INR 707.6 Cr) Series F round led by Naspers and existing shareholder Meituan-Dianping (February 2018)

Other significant disposals by the group during the reporting period included sale of its 52% interest in Gurugram-based Tek Travels Private Limited (Travel Boutique Online), its online B2B travel distribution business, for $37 Mn (INR 261.8 Cr).

Amazon India Receives $311.5 Mn Shot In The Arm As Ecommerce Battle Continues

Amazon India had earlier received $1.38 Bn in 2018

Amazon India is fighting Walmart-Flipkart for dominance in India

Amazon gets more product returns in India than in any of the 17 markets where it operates

Global ecommerce company Amazon has reportedly invested $311.51 Mn (INR 2,200 Cr) in its Indian subsidiary, the fourth tranche of its $5 Bn (INR 35,255 Cr) commitment to its expansion in the country. The filings showed that the investment came from Singapore-based Amazon Corporate Holdings and Mauritius-based Amazon.com.inc on November 19.

The company has already received $3.86 Bn (INR 27,290 Cr), which includes $1.38 Bn (INR 9,450 Cr) in 2018 itself. Amazon Seller Services, the marketplace business of Amazon India, received $381.94 Mn (INR 2,700 Cr) in August, $367.78 Mn (INR 2,600 Cr) in May and $276 Mn (INR 1,950 Cr) in January.

In another development, Dharmesh Mehta, vice-president for consumer and brand protection at Amazon, said that Amazon gets more product returns in India than in any of the 17 markets where it operates. The company also claims to deploy machine learning-based and automated tools to thwart counterfeit products and likely bring to India the capability to allow users and sellers to scan a manufacturer’s code through a mobile application to check for authenticity.

According to a report by investment bank and financial services company Barclays entitled Amazon Races To The Top Of India Ecommerce, Amazon India recorded $7.5 Bn (INR 52, 994 cr) in gross merchandise value (GMV) in the financial year ending March 31, 2018.

The report noted that India represents 7% of Amazon’s international retail operational expenses in the calendar year 2018.

The competition for Amazon in India is stronger than ever with its global rival Walmart acquiring its Indian ecommerce rival Flipkart to fight for the share of dominance in Indian retail market, touted to reach $200 Bn by 2026.