Jabong loss further widens to Rs 227.4 cr in H1

German investor Rocket Internet-backed fashion player Jabong ’s losses in January to June period widened to Rs 227.4 crores compared to Rs 155 crores, in the same period, last year. Sales increased marginally by 26 percent to Rs 410.7 crores compared to Rs 324.7 crores in January-June period of 2014.

However, total number of orders during the six months increased over 17 percent to 2.7 million while transactions were up 37.5 percent compared to the corresponding period last year. Gross merchandise value or GMV too rose 41.3 percent to Rs 719.7 crores from Rs 509.5 crores for the first six months last year.

After its disastrous performance in the first quarter of this fiscal, there have been talks of its global investors looking at selling off this loss-making venture. Recent reports suggested that companies such as Snapdeal and payment services provider Paytm are in the queue to acquire Jabong. If the deal gets through, it would be the second largest acquisition after Flipkart acquired Myntra in May 2014.

Sources claim A B Kinnevik, the largest shareholder of GFG, is leading the talks. Kinnevik is also negotiating terms on behalf of Rocket Internet, which holds over 21 percent stake of GFG. Kinnevik owns more than 25 percent stake of GFG. With struggle to become profitable and remain ahead in the competition gains momentum, leaders of India’s ecommerce – Flipkart, Snapdeal and Amazon are looking at acquiring viable businesses.

Hunt for a new CEO to drive business is also said to be underway after co-founders Praveen Sinha and Arun Chandra Mohan resigned from the company.