Big e-commerce players are on a shopping spree to get an upper hand on India’s fast-growing online market for food, fashion, electronics and groceries. This time around, its Flipkart’s move. Walmart owned Indian e-commerce player Flipkart will acquire around 7.8 per cent stake in Aditya Birla Fashion and Retail Limited or ABFRL. Flipkart Investments will be shelling out around Rs 1500 crores in investments to acquire this stake in the Aditya Birla’s fashion unit.
With this investment, Flipkart Group will further strengthen its fashion unit, which is already the biggest in Indian e-commerce space, thanks to the recent acquisition of Myntra and Jabong. The deal with ABFRL will boost the range of fashion brands offered on both Flipkart and Myntra. The partnership will bring in a wide range of premium international and Indian brands to these e-commerce stores.
Flipkart will also enhance ABFRL’s Omni-channel capabilities with its technology to enrich customer experiences while continuing to provide access to premium loyalty programs and affordability.
“Through this partnership with ABFRL, we will work towards making available a wide range of products for fashion-conscious consumers across different retail formats across the country. We look forward to working with ABFRL and its well established and comprehensive fashion and retail infrastructure as we address the promising opportunity of the apparel industry in India,” said Kalyan Krishnamurthy, CEO, Flipkart Group.
ABFRL will use the invested money to strengthen its balance sheet. The company plans to scale-up its emerging high-growth fashion categories like innerwear or athleisure, casual wear and ethnic wear. It also plans to accelerate the execution of its largescale digital transformation strategy that will deepen its consumer connect and augment its backend capabilities. Thus, positioning the company amongst the most comprehensive omnichannel fashion players in the country.
“…this partnership has the potential to dramatically accelerate the growth of the apparel industry in India and reshape apparel commerce. This deal also provides a tremendous opportunity to build the scale of existing brands and expand its brand portfolio into emerging consumer segments”, said Ashish Dikshit, MD of ABFRL.
The investment comes at a time when on one side we have Reliance, with its big pocket acquiring or taking control of Future Group. Besides they are taking a large stake on numerous small players like NetMeds, Haptik, Hamleys, Saavn, Fynd, Edcast, and others. On the other side, we have Amazon which has acquired a large stake on Birla’s More store.