Walmart, owners of top ecommerce marketplace Flipkart, is not surprised by internet major Facebook’s investment in Reliance, Brett Briggs, chief financial officer of the US retail giant, has said.
“It’s (online retail space) been competitive…Reliance, Amazon… When you have 1.3 billion people, it’s going to attract a lot of investment…a lot of the reasons why we went there. So, it’s not surprising,” Briggs said at a Bernstein annual conference while answering whether Facebook’s investment in the Mukesh Ambani-controlled rival will be a “game changer” in India.
Last month, Facebook had bought 9.9% stake in Jio Platforms for Rs 43,574 crore, making it the largest minority shareholder in the holding firm of Reliance Industries’ digital businesses including Reliance Jio Infocomm.
Flipkart’s sales plunged in late March and April, like almost all online and offline retailers, as India went in for a complete lockdown to contain the spread of the Covid-19 pandemic.
The government had restricted online players from selling anything apart from essentials such as food and groceries, which make up only a small portion of sales on Flipkart platform. The government has since lifted the ban on selling non-essentials.
“We are starting to get back to a little bit more normal operations there,” Briggs said. “And just like with every other country, I think India will go through a different cycle. They were pretty early to shut the country down. So, we will see how that plays out. But, it’s a great business for us and I think will continue to be for a long time,” he said.
Before the pandemic, India was one of the most attractive ecommerce markets globally, expected to deliver 30% CAGR over a six-year time horizon, according to a report by RedSeer Consulting that projected the sector to record $160 billion in gross merchandise values (GMV) by 2022.