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Flipkart injects Rs. 330 crore into Myntra

Flipkart, Myntra, Investment

New Delhi: India's biggest e-commerce company Flipkart, has infused $50M ( Rs. 338 crore) into fashion e-commerce company Myntra in an attempt to boost its leadership position in the fashion segment.

According to reports, Myntra Designs Pvt. Ltd received the funds from Singapore-based FK Myntra Holdings Pvt. Ltd which is a Flipkart owned unit.

Online retailer Flipkart acquired online clothing seller Myntra Designs in 2014 for an estimated Rs 2,000 crore, in a deal that gave Flipkart control of roughly half of nation's e-commerce market by sales. This acquisition gave Flipkart, set up by two ex-Amazon employees in 2007, access to Myntra's customers and suppliers for a stronger foothold in the fast-growing online fashion market that has giants like EBay and Amazon sprawling.

The funds for Myntra come at a time when its nearest rival, Rocket Internet-backed Jabong, received a funding of $20 million from the Global Fashion Group (GFG) to keep the loss generating firm afloat for another year.

For the year ended 31 March 2015, although Flipkart’s revenue grew 77% yoy to Rs. 758 crore its looses also tripled to Rs.1,126.60 crore as compared to Rs.386.10 crore the year earlier.

Recently, Indian e-commerce player, Flipkart secured a credit line of over $67 million (Rs. 450 crore) from private sector lender HDFC Bank, with reports suggesting the funds would be used by the firm to maintain day-to-day operations.

Flipkart also recently announced the launch of its own mobile wallet ‘Flipkart Money’. This wallet will help it cut significant costs related to handling cash on product returns, in addition to offering users a new payment method.

All above strides by Flipkart shows that it is keen to maintain its position at the apex of Indian e-commerce market, with bitter rivals Snapdeal and Amazon engaging in aggressive strategies to strengthen its foothold in the India market.

Just recently Flipkart saw it valuation being slashed 25% by Morgan Stanley which has stake in the e-commerce company. This saw Flipkart’s valuation to decline from $15.2 billion to $11 billion.


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