Investors pumped over Rs 9,700 cr across 24 deals so far this year in E-commerce industry

In What’s Happening in Retail by Elargirindia0 Comments

No one likes to miss the bus a second time. Investors who missed out on the ecommerce boom in the country that began earlier this decade are keen to make amends this time round.These investors, ranging from private equity and venture funds to international hedge funds and brick-and-mortar retailers, are currently evaluating a number of online companies, especially niche single-category retailers in segments such as web-only fashion, babycare and eyewear."We are very aggressively looking at investing in ecommerce, especially something with local connect or an offline presence," said Manas Tandon, principal at TPG Growth India, which has not invested in a consumer Internet company in India so far. "We have seen some interesting businesses," said Tandon, whose fund has backed businesses such as accommodation listings provider Airbnb and messaging app Viber globally.Tandon declined to reveal the names of the companies that his fund is in talks with. Recently, Hong Kong hedge fund Steadview Capital made its India entry by investing in music streaming service Saavn, furniture site Urban Ladder and taxi service OlaCabs, the back-to-back deals an indication of the seriousness with which it views the India market.The Internet sector’s scorching pace of growth and high-profile deals are fuelling the intense interest. The online retail industry, which was valued at $1 billion two years ago, is expected to reach $32 billion (Rs 1.9 lakh crore) in 2020, according to retail advisory firm Technopak. This year has already seen a flurry of deals investors have pumped in over $1.6 billion (Rs 9,700 crore) across 24 deals so far this year, compared with $553 million (over Rs 3,300 crore) last year across 36 deals, according to research firm Venture Intelligence.Multiples Alternate Asset Management, a private equity fund founded by former ICICI Venture head Renuka Ramnath, is also trying to cash in. The Mumbai-based fund has been watching ecommerce from "time to time", Managing Director Prakash Nene said. "We don’t invest in early stage, but when business models get proven and there is runaway growth with a good management team we would like to invest," he said.Supam Maheshwari, co-founder and chief executive of online babycare company Firstcry, said his company is an object of interest for potential newbies. Several have "reached out" to him less than eight months after his firm raised over Rs 90 crore. He declined to reveal names of these investors. "Those who have never invested in Internet or those who have not invested in ecommerce in India are now reaching out," he said.Large fundraises by industry leaders, such as Flipkart and Snapdeal, and the entry of investors like Singapore’s sovereign wealth fund GIC have boosted investor confidence. "There is a lot of interest now," said Manish Chopra, chief executive of web-only fashion brand Zovi, which is in talks with investors to raise about $25 million (Rs 150 crore). The company, backed by SAIF Partners and Tiger Global, has raised about $25.5 million (Rs 153 crore) so far.

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