Indian E-Commerce to Become $8 Billion Industry

March 2, 2014 Leave a comment

Feb 25, 2014

Report: Indian E-Commerce to Become $8 Billion Industry

SAPTARISHI DUTTA

The outlook for India’s economy may be gloomy for now, but one sector looks set to boom: online retail.

As more and more Indians use the internet, revenues of e-commerce companies could triple over the next three years to 504 billion rupees ($8.13 billion), according to Crisil Research, a unit of Mumbai-based ratings firm Crisil Ltd.

There are around 200 million internet users in India currently and the number could grow to 500 million by 2015, according to consulting firm McKinsey & Co.

Over the last few years, dozens of websites have been launched in India to sell everything from books and appliances, to baby care products and flight tickets.

Online retail companies earned revenues of around 139 billion rupees ($2.24 billion) in the financial year that ended on March 31, 2013, according to the Crisil report. Though this is just 0.5% of the total revenues of brick-and-mortar retail companies, online retail sales have been growing much faster.

Revenue of e-commerce firms grew by 56% annually between the financial year that ended March 31, 2008, and the year ended March 31, 2013, according to Crisil.

The scope for growth in this sector has already attracted a lot of interest from venture capital investors.

Earlier this month, online retailer Jabong.com raised around $100 million from CDC Group PLC, a U.K. government-backed private-equity fund-of-funds that invests in some emerging markets, according to The Economic Times.

Clothing and accessories-seller Myntra.com also raised $50 million, this month.

Foreign companies have also been looking to get a piece of the action in India.Amazon.com Inc. launched its India website in June.

 

Filed under Macro Trends, TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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