There’s been a great deal of interest in ecommerce in India of late. Obviously, Walmart is going to buy Flipkart in a multi-billion dollar deal. And that has prompted eBay to withdraw from it’s arrangement with Flipkart and announce that it will be relaunching eBay.in. And seeing as it will receive $1.1bn for divesting its interest in the Indian marketplace. So there is a bit of a land grab going on and and analysts report on the value of Amazon India helps understand the battle is hotting up.
Mark May, an analyst with Citi Group, has issued his assessment of Amazon India and it’s that the current valuation for the division is $16bn. His belief is based on the under-appreciation of the size of ecommerce in India, the pace of its growth and Amazon’s successful investment and expansion strategy. Amazon has committed to spending $5B to build its business in India over the next few years.
Amazon’s investments in India have been consistent with a strategy for long-term success. For instance, the company has aggressively built out its distribution network to service the third-party sellers and customers it serves in the market.
We believe the India ecommerce market will grow at a 21% CAGR* over the next 10 years to $202bn, that Amazon could capture 35% of this market.That suggests that Amazon India could be currently worth $16bn. In short, not only do we believe that investors continue to under-estimate the value of Amazon’s existing Emerging International Retail Markets businesses, but also the pace and value of its recent international expansion efforts.
– Mark May, Citi Research
Obviously Amazon is well-placed to get a decent share of online retail in India, Walmart is in a good place with Flipkart and eBay’s potential is less certain. But what is the opportunity for European ecommerce merchants?
The sad answer is that selling to India and it’s one billion population is not straight-forward and you need local business entities to trade and local agents in-country. The more crucial aspect of growth in India is that it will likely bring greater competition from Indian sellers.
*Compound Annual Growth Rate
One Response
Has anyone managed to find a way into Amazon.in? Quite a lot of loopholes to jump through. Need to register the business locally and have some physical presence in India.
Anyone know companies that offer this?