Snapdeal To Raise $600-$650 million Funding

In order to expand its operations, famous online ecommerce site Snapdeal is in the process of raising around $600 to $650 million from its existing investors. According to some people involved in the process, the fundraising is being led by SoftBank Corp from Japan.

The figure, which is the second biggest investment in the growing ecommerce market of India, will most probably be announced next week. The biggest investment of $ 1 billion was raised by Flipkart in July this year.

With more and more Indians turning towards online shopping, online Indian retailers have been working hard towards raising funds in order to compete with the growing competitive ecommerce market of the country.

According to a July research note by Analysts at Nomura, the ecommerce market in India could take a massive leap to $43 billion in the coming five years from the 2013 $10 billion figure and that too just by online retail.

Snapdeal's existing list of investors includes Ratan Tata, SoftBank Corp, Temasek Holdings Pvt Ltd and eBay Inc.

The online retailer since its inception has been successful in raising around 400 million US dollars. The Company had also raised around 100 million dollars in May this year. In February, it raised around USD 133.7 million from its existing investors.

Snapdeal has more than 5 million products in over five hundred diverse categories from over fifty thousand sellers, selling everything from mobile phone to clothes to shoes. The company for the last two years has seen over 600 percent growth year on year.

Indian Online retailers have been successful in raising the interest of industry veterans like Azim Premji and Ratan Tata and private equity firms at the same time.

Amazon had also announced a USD 2 billion dollar investment in India this year. The announcement came soon after Flipkart’s 1 billion investment announcement in July.

According to a report by Assocham and consultancy firm PwC, the ecommerce companies are expected to spend up to 1.9 billion US dollars on warehousing, logistics and infrastructure by 2017-2020.

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