Flipkart injects $147 mn into logistics arm eKart
Photo Credit: Reuters

Homegrown e-commerce major Flipkart has infused Rs 961.4 crore ($147.1 million) into its logistics arm eKart, which is operated by Instakart Services Pvt. Ltd, documents filed with the Registrar of Companies reveal.

According to the filings dated 28 September, eKart raised this sum by allocating 15.38 crore shares at Rs 62.51 apiece to Singapore-based group firm Klick2Shop Logistics International Pvt. Ltd.

This price is higher than eKart’s previous funding round. In January 2016, the logistics company had raised Rs 666.49 crore ($102 million) from Klick2Shop by allocating 66.64 crore shares at the face value of Rs 10 apiece.

Flipkart did not respond to email queries regarding this funding round by the time of filing this report.

Klick2shop is the controlling entity of Instakart and is most likely a subsidiary of Flipkart Pvt. Ltd, the Singapore-based flagship parent of the online retailer.

The latest funding into the logistics arm comes after the e-tailer received mega fund infusion of $2.5 billion from marquee investor SoftBank in August. In April, it had raised $1.4 billion from Microsoft, Tencent and eBay Inc, in a transaction that also saw it acquire the Indian operations of eBay.

Flipkart has been ramping up its logistics infrastructure significantly of late. The firm recently opened nine warehouses to handle large appliances and ensure next-day deliveries during the festive sales season.

During its flagship annual sales event, Big Billion Days 2017, held from 20 to 24 September, Flipkart is said to have clocked 40% year-on-year growth and generated $1.05 billion, according to an estimate by research and advisory firm RedSeer Consulting.

The event also saw its market share in terms of gross merchandise value increase to 58% from 50% in 2016. Flipkart is also estimated to have garnered around 70% of the total festive season sales that the various e-commerce players held between 20 and 25 September, a figure that main rival Amazon has disputed.

Amazon has also invested in expanding its network of fulfilment centres to 41 in 13 states across India with a combined storage space of close to 13 million cubic feet, it said recently. Last month, it opened in Telangana its largest fulfilment centre, with 400,000-sq-feet area and about 2.1 million cubic feet of storage space.

In August, VCCircle had reported that Amazon had put in Rs 400 crore into its logistics arm, Amazon Transportation Pvt. Ltd.

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