E-commerce on a growth track but leading players report losses

While India’s e-commerce market is rapidly growing, with sales of leading players like Flipkart competing with that of major offline retailers, the marketplaces operated by both Flipkart and Amazon registered losses. Amazon, which entered India a year ago, reported a net loss of Rs 321 crores and Flipkart saw this more than double to Rs 400 crores, according to their October 31 filings.

Since India does not allow foreign investment in companies selling directly to consumers, Flipkart and Amazon run their websites as marketplaces, where FDI is permitted. Hence, the figures relate to commissions from sellers and revenue from advertisements on e-commerce sites. In this respect, Amazon Seller Services posted revenue (commissions) of Rs 169 crores while Flipkart Internet, which manages the portal, had a total income of Rs 179 crores. However, Flipkart India, the website's wholesale arm, said sales amounted to Rs 2,846 crores in the year ended March 2014, more than double the Rs 1,180 crores a year ago. In the offline space, rival Shoppers Stop posted revenues of Rs 2,713 crores through its 73 department chain stores that retail apparel and lifestyle products.

On a consolidated basis, Shoppers Stop including HyperCity, said sales amounted to Rs 3,771 crores. The Kishore Biyani-run Future Lifestyle Fashion posted total income of Rs 2,743 crores from its department store formats Central and Brand Factory besides its own labels such as Indigo Nation and John Miller. While Amazon Wholesale didn't disclose a comparable total, its total income amounted to Rs 1.4 lakh with a net loss of Rs 3.71 crore for the six months ended March.