Amazon invests another Rs 2,700 crore in Indian marketplace business

Global online retailer Amazon invested an additional Rs 2,700 crore in its Indian marketplace business earlier this month, and also invested around Rs 100 crore in its food retail business, according to a report by Mint.

The marketplace arm of Amazon India -- Amazon Seller Services -- received the funds earlier this month, according to regulatory documents filed with the Registrar of Companies sourced by Paper.vc.

The latest capital infusion brings Amazon's total investment in India to roughly $4 billion in the five years.

The retailer had earlier committed to invest at least $5 billion in India, and separately allocated an additional $500 million to build its food retail business in the country.

After having achieved its previous target of investing around $2 billion in India, Amazon Inc Chief Executive Officer Jeff Bezos had said in June 2016 that the company would invest an additional $3 billion in the country.

Amazon has used the previous investments to build massive warehouses, a large logistics unit, and for marketing, offering discounts and increasing product assortment, all aimed at stepping up its battle against Flipkart.

Analysts believe that Amazon and Flipkart are expected to spend hundreds of millions of dollars towards expansion over the next few years, as both companies give more priority to sales growth than cutting losses.

Flipkart is likely to spend as much as $2 billion in cash over the next one and a half years to push its sales growth, following its acquisition by global retail giant Walmart.

According to the report, Amazon India chief Amit Agarwal has repeatedly indicated that the online retailer will invest as much as necessary to conquer the domestic market.

India is one of the most important international markets for Amazon Inc and winning the market share battle here is its topmost priority, especially after it lost out to Alibaba in China.

Amazon, however, may have to keep up its aggressive pace of investments in India in the near term, given that it is up against Flipkart, which is now backed by an equally deep-pocketed Walmart.