Flipkart Registers A 43% Rise In GMV In The Third Quarter!
Flipkart is just recovering from a tough last year where they lost their market share and senior executives in an organisational restructuring
The recent market share numbers shared by South African media giant Nasper show that India’s largest ecommerce platform Flipkart has registered a 43% growth in their gross merchandise value (GMV) for the last the six months which ended in September.
As per the financial reports shared by Naspers, a primary investor in the company, the e commerce company has seen a major jump in its market share from the same a period year ago.
Flipkart is facing a constant competition from Amazon India. They had a tough 18-month period during which they lost a major part of their market share and most of its senior executives during an organisational restructuring. Despite all difficulties, it continues to lead in the ecommerce space in India.
Consolidated Business & Fresh Investments
The e-commerce major Flipkart presently owns online apparel companies Myntra and Jabong along with payments app PhonePe (powered by Yes Bank), and eBay India. These companies have helped maintain their position in the unstable Indian e-commerce market. The steady festive season sales also contributed to the growth. During the festive season they had around 70% of the total e-commerce market in India.
Flipkart recently had substantial capital investments from Chinese internet giant Tencent and Japanese investment major SoftBank. The company continues to build their position as the leading business-to-consumer (B2C) platform in the fast growing internet led Indian market.
Flipkart & Amazon
Jeff Bezos backed Amazon India (a subsidiary of Amazon Seller Services Pvt Ltd) has repeatedly claimed that Amazon is ahead of Flipkart (excluding Myntra and Jabong) by calculating their gross sales. The Gross sales of a firm refers to the value of the goods sold through the platform, and not the net revenue.
In the first two quarters of 2017 till June, Amazon has said that have recorded a unit sale growth by 85% and 88% respectively, compared to the same period in 2016.
There has been a difference in the growth figures between Amazon and Flipkart, and it was primarily due to the one-time charges. But the turnaround point for Flipkart was engineered by Kalyan Krishnamurthy, who was brought back to Flipkart by the alarmed investors in June 2016 after a predatory assault by Amazon India.
Amazon India overtook them in their monthly sales on a standalone basis in the period between August to September last year.
Krishnamurthy’s return has helped Flipkart with their sales. The senior management team promoted Krishnamurthy to CEO in January.
Naspers & Flipkart
This recent steady growth of Flipkart has resulted in augmentation of the value of holdings of Naspers holdings in the e-commerce sector in the country. The increased sales and strong growth has helped with the classifications and payments, and their revenue has shown a growth acceleration to 38% on a Year-on-Year basis, and a significant growth over the 24% reported last year.
It’s A Close Tie!
Last month both, Amazon as well as Flipkart, had an equal standing in the ecommerce space. But, Amazon still lags in the festive season sales, and Flipkart’s recent $4 Billion funding from SoftBank, Tencent, eBay and Microsoft will help it give Amazon India a tough fight.
The US based ecommerce giant has doubled their authorized capital to $4.74 Bn (Rs. 31,000 Cr) in last three years with a earlier capital commitment of $5 Billion made in June last year by Jeff Bezos.