After Snapdeal, Flipkart Too Pumps In Fresh Funds To Its Logistics Arm eKart

India's largest e-commerce firm Flipkart has infused another Rs 1,632.81 crore ($257.3 million) into its logistics arm eKart, which is operated by Instakart Services Pvt. Ltd, reported VCCircle citing the filings with the Registrar of Companies (RoC).

This has come just after few days when another homegrown e-commerce firm Snapdeal had infused ₹27 crore into its own logistics arm Vulcan Express.

According to the filings with the ministry of corporate affairs, Instakart Services Pvt. Ltd received four separate tranches of investment from Flipkart, amounting to roughly Rs2,600 crore (about $408 million) since September. The latest tranche of Rs1,632 crore was the largest infusion that Flipkart made in eKart over the past six months, according to documents filed on 19 December.

The filings further said that, eKart raised this sum by allocating equity shares at Rs 62.51 apiece to its Singapore-based group firm Klick2Shop Logistics International Pvt. Ltd., a subsidiary of Flipkart only.

Meanwhile, another logistics startup major Ecom Express has also initiated the process of raising at least $75 million in a new round of funding, reported LiveMint a while ago. Just a few days back we also reported that an another logistics firm Xpressbees, spun out of dotcom startup FirstCry, is in talks to raise about $100 million from China’s Alibaba Group.

According to a report, the logistics market is expected to grow to $9.6 billion by 2020 from $1.4 billion in 2015.

Industry experts said that Flipkart will continue to pump in large amounts into its logistics arm, in future as well.

Earlier, Amazon, which is Flipkart’s biggesr rival in India, has also been significantly ramping up its investments and warehousing capability. In August 2017, the firm’s logistics arm, Amazon Transportation Services Pvt. Ltd, received $63 million in funding.

After Snapdeal, Flipkart Too Pumps In Fresh Funds To Its Logistics Arm eKart

India's largest e-commerce firm Flipkart has infused another Rs 1,632.81 crore ($257.3 million) into its logistics arm eKart, which is operated by Instakart Services Pvt. Ltd, reported VCCircle citing the filings with the Registrar of Companies (RoC).

This has come just after few days when another homegrown e-commerce firm Snapdeal had infused ₹27 crore into its own logistics arm Vulcan Express.

According to the filings with the ministry of corporate affairs, Instakart Services Pvt. Ltd received four separate tranches of investment from Flipkart, amounting to roughly Rs2,600 crore (about $408 million) since September. The latest tranche of Rs1,632 crore was the largest infusion that Flipkart made in eKart over the past six months, according to documents filed on 19 December.

The filings further said that, eKart raised this sum by allocating equity shares at Rs 62.51 apiece to its Singapore-based group firm Klick2Shop Logistics International Pvt. Ltd., a subsidiary of Flipkart only.

Meanwhile, another logistics startup major Ecom Express has also initiated the process of raising at least $75 million in a new round of funding, reported LiveMint a while ago. Just a few days back we also reported that an another logistics firm Xpressbees, spun out of dotcom startup FirstCry, is in talks to raise about $100 million from China’s Alibaba Group.

According to a report, the logistics market is expected to grow to $9.6 billion by 2020 from $1.4 billion in 2015.

Industry experts said that Flipkart will continue to pump in large amounts into its logistics arm, in future as well.

Earlier, Amazon, which is Flipkart’s biggesr rival in India, has also been significantly ramping up its investments and warehousing capability. In August 2017, the firm’s logistics arm, Amazon Transportation Services Pvt. Ltd, received $63 million in funding.

Flipkart’s Logistics Arm Ekart Gets Rs 641 cr Funding From Group Firm Klick2Shop

According to information unearthed from recent regulatory filings with the Ministry of Corporate Affairs, Indian e-commerce leader Flipkart’s logistics arm Ekart has become the recipient of a fresh funding infusion of Rs 641 crore from its very own Singapore-based group firm Klick2Shop Logistics Services International. The fund infusion has taken place through an entity called Instakart Services Private Limited.

The fund infusion in Ekart doesn’t come as a surprise as the recent times have seen various top e-commerce players in the country trying their best to strengthen their logistics network so as to ensure fast and smooth delivery of the heavy load of shipments coming their way during the forthcoming festive season. Prior to the Rs 641 crore capital infusion from Klick2Shop into Ekart through its subsidiary Instakart Services, the Bengaluru-based e-commerce giant had infused a stellar Rs 666 crore into its Instakart some 18 months ago.

For the uninitiated, Flipkart had bought back its logistics arm Ekart two years ago in 2015 from WS Retail Services, the largest retailer on its platform.

According to people who expertise in India’s logistics industry, currently, about a major 70 per cent of Flipkart’s logistical needs are being delivered by Ekart. In fact, they predict that the number might soon be touching 80 per cent.

People known in the logistical space expect Flipkart to utilise the funds received for setting up and decentralising the warehouses following how goods and services tax (GST) affected the e-commerce industry since it came into play in the country since July 1 this year. The money could also be put to use for hiring more manpower and then setting up last-mile delivery centres.

In addition to all this, experts operating in the sector also believe that Flipkart might consider providing its Ekart services to other companies as well. According to ongoing rumours in the market, Flipkart, which is already the numero uno players in the Indian ecommerce market may also expand its network further to include grocery services by year end.

Recent times have witnessed all top e-commerce firms trying their hand at taking their logistics network to a whole another level in a bid to better customer experience on their e-commerce platforms. They have realised that the secret to win over Indian consumers is to not only provide them better quality products but make these products available to them fasters than others.

Alibaba-backed Paytm Mall had recently infused approximately $35 million in its logistics network to boost same and next-day deliveries, which according to the company makes up for a whopping 60 per cent of its deliveries.

On the other hand, Amazon India has been enthusiastically promoting its Amazon Prime service, which promises to provide quicker, next day deliveries to its members compared to the non-members. Interestingly, the global ecommerce giant has established the largest number of fulfillment centres in India outside of the United States.

This development was first reported in the Economic Times.