“While Amazon and Flipkart (ex-Myntra and Jabong) were neck-and-neck in terms of GMV in FY17, Amazon has taken the clear lead in FY18 with GMV of $7.5 billion as compared to $6.2 billion for Flipkart on a standalone basis,” says the report released on November 26.
But the report also adds that in terms of revenues, Flipkart continues to be ahead of Amazon, even though the company is growing much faster. Amazon’s US rival Walmart acquired 77% in Flipkart earlier this year paying $16 billion, valuing it at $22 billion.
“Flipkart continues to be bigger than Amazon in terms of revenue ($3.8 billion vs $3.2billion), although Amazon is catching up quickly and continues to grow much faster (82% vs 47%),” said the report by Barclays US analysts Ross Sandler, Deepak Mathivanan and Karen Short.
Amazon India spokesperson said: “We do not offer comment on industry reports.” Flipkart spokesperson also did not offer a direct comment on the report saying, “Flipkart remains an unquestioned leader… cornered a disproportionate 70% market share over the five day TBBD (The Big Billion Days) period this year as highlighted by independent researchers.”
The report comes as Flipkart has seen a top-level churn earlier this month, with exit of group CEO Binny Bansal after what Walmart termed as “personal misconduct” and “lack of transparency”. The report adds that both the companies are aggressively investing to grow India’s online retail market. “Investment is increasing rapidly at Amazon (India represents ~7% of international retail opex in calendar 2018), and Flipkart operating losses could be in the ~$1.5-billion range for the year ending January 2020,” it added.
Amazon has invested a little over a $1 billion in its main India unit, Amazon Seller Services, so far this year. It has infused about Rs 7,250 crore in this unit across three tranches in 2018. Amazon’s total infusion into its marketplace business now stands close to Rs 25,090 crore or over $3.6 billion.
Barclays also said that it expects India’s online retail business to reach $40-45 billion by end of 2020. “With rising internet penetration, payment options, and delivery infrastructure, ecommerce users are expected to more than double, from 80-90 million in 2017 to 180-200 million in 2020, and the market is expected to increase from $18-20 billion in 2017 to $40-45 billion in 2020, with apparel and consumer electronics driving bulk of the growth,” the report said.