India’s online retailers get boost from investors



India’s online retail sector is poised to surge in growth as investment pours in.

Several online firms in India have secured fresh funding in recent months. Flipkart, India’s biggest online retailer. bought the country’s largest online fashion portal, Myntra, in May for an estimated US$300 million. Flipkart announced in the same month that it had received $210m of funds from a group of investors led by DST Global, an investment company controlled by the Russian billionaire Yuri Milner, which has also backed Facebook, Twitter and Groupon.

Snapdeal, another major Indian online retail firm, a couple of months ago raised $100m from investors including the US investment firm BlackRock, just three months after announcing that it had raised more than $133m in equity.

Amazon’s entry into India last year has had a major impact on the market, triggering such deals and investments as competition grows fiercer, analysts say.

“The global leader is expected to vie for the top slot in India as well, which has triggered an increased urgency and competitiveness within the sector,” says research by Technopak, an Indian consultancy. “As a result, there has been a significant increase in the investments that are being injected as well as the speed of consolidation.”

This consolidation process in India’s online retail sector is expected to continue, according to the consultancy.

“Players sharing common investors will increasingly look at mergers, acquisitions, while niche and speciality players possessing unique positioning, assets or capabilities will attract acquisition by the bigger players.”

India’s e-commerce has attracted $1.6 billion across 140 deals since 2012, Technopak says. In the first five months of this year, the sector has attracted $637m of funding compared to $592m in all of 2013.

The online retail industry is expected to grow to $32bn by 2020, up from its current value of $2.3bn, according to Technopak.

Aditya Birla, a major Indian conglomerate, is planning to embark on a programme to study opportunities in the e-commerce sector, India's Economic Times reported recently.

Walmart at the beginning of this month launched a wholesale e-commerce platform in India offering products to registered clients of its cash-and-carry stores in Hyderabad and Lucknow.

In this month’s union budget India announced that foreign companies manufacturing products there would be allowed to sell their goods directly to customers through e-commerce websites.

Foreign online retailers such as Amazon are not allowed to sell their own products in India under overseas investment regulations, but Reuters last month reported that the government is considering lifting this restriction.

business@thenational.ae

Follow The National's Business section on Twitter

COMPANY PROFILE
Name: HyperSpace
 
Started: 2020
 
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
 
Based: Dubai, UAE
 
Sector: Entertainment 
 
Number of staff: 210 
 
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
UAE rugby in numbers

5 - Year sponsorship deal between Hesco and Jebel Ali Dragons

700 - Dubai Hurricanes had more than 700 playing members last season between their mini and youth, men's and women's teams

Dh600,000 - Dubai Exiles' budget for pitch and court hire next season, for their rugby, netball and cricket teams

Dh1.8m - Dubai Hurricanes' overall budget for next season

Dh2.8m - Dubai Exiles’ overall budget for next season

Profile Periscope Media

Founder: Smeetha Ghosh, one co-founder (anonymous)

Launch year: 2020

Employees: four – plans to add another 10 by July 2021

Financing stage: $250,000 bootstrap funding, approaching VC firms this year

Investors: Co-founders

Singham Again

Director: Rohit Shetty

Stars: Ajay Devgn, Kareena Kapoor Khan, Ranveer Singh, Akshay Kumar, Tiger Shroff, Deepika Padukone

Rating: 3/5

What are NFTs?

Are non-fungible tokens a currency, asset, or a licensing instrument? Arnab Das, global market strategist EMEA at Invesco, says they are mix of all of three.

You can buy, hold and use NFTs just like US dollars and Bitcoins. “They can appreciate in value and even produce cash flows.”

However, while money is fungible, NFTs are not. “One Bitcoin, dollar, euro or dirham is largely indistinguishable from the next. Nothing ties a dollar bill to a particular owner, for example. Nor does it tie you to to any goods, services or assets you bought with that currency. In contrast, NFTs confer specific ownership,” Mr Das says.

This makes NFTs closer to a piece of intellectual property such as a work of art or licence, as you can claim royalties or profit by exchanging it at a higher value later, Mr Das says. “They could provide a sustainable income stream.”

This income will depend on future demand and use, which makes NFTs difficult to value. “However, there is a credible use case for many forms of intellectual property, notably art, songs, videos,” Mr Das says.

COMPANY PROFILE
Name: ARDH Collective
Based: Dubai
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Sector: Sustainability
Total funding: Self funded
Number of employees: 4
The five types of long-term residential visas

Obed Suhail of ServiceMarket, an online home services marketplace, outlines the five types of long-term residential visas:

Investors:

A 10-year residency visa can be obtained by investors who invest Dh10 million, out of which 60 per cent should not be in real estate. It can be a public investment through a deposit or in a business. Those who invest Dh5 million or more in property are eligible for a five-year residency visa. The invested amount should be completely owned by the investors, not loaned, and retained for at least three years.

Entrepreneurs:

A five-year multiple entry visa is available to entrepreneurs with a previous project worth Dh0.5m or those with the approval of an accredited business incubator in the UAE.  

Specialists

Expats with specialised talents, including doctors, specialists, scientists, inventors, and creative individuals working in the field of culture and art are eligible for a 10-year visa, given that they have a valid employment contract in one of these fields in the country.

Outstanding students:

A five-year visa will be granted to outstanding students who have a grade of 95 per cent or higher in a secondary school, or those who graduate with a GPA of 3.75 from a university. 

Retirees:

Expats who are at least 55 years old can obtain a five-year retirement visa if they invest Dh2m in property, have savings of Dh1m or more, or have a monthly income of at least Dh20,000.

Tree of Hell

Starring: Raed Zeno, Hadi Awada, Dr Mohammad Abdalla

Director: Raed Zeno

Rating: 4/5

MATCH INFO

Manchester City 0

Wolves 2 (Traore 80', 90 4')

Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

Match info

Arsenal 0

Manchester City 2
Sterling (14'), Bernardo Silva (64')