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China’s Alibaba in talks to enter Indian market
September 18, 2014, 8:18 am

An employer walks past exhibition boxes printed with the logo of Alibaba Group in the Taobao City of Alibaba Group in Hangzhou, capital of east China's Zhejiang Province, March 25, 2014 [Xinhua]

An employer walks past exhibition boxes printed with the logo of Alibaba Group in the Taobao City of Alibaba Group in Hangzhou, capital of east China’s Zhejiang Province, March 25, 2014 [Xinhua]

Chinese e-commerce giant Alibaba has initiated talks with NewDelhi-based Snapdeal to enter the Indian online retail market, says an Indian media report on Thursday.

“India is a huge opportunity for Alibaba. Eventually it will look at entering the business-to-consumer space in India and talks are on,” the Indian daily Economic Times quoted a source as saying.

The deal could heat up competition in the country even as Flipkart, India’s largest e-tailer, said in July, it raised a fresh round of funding worth $1 billion. Flipkart is trying to aggressively scale up after Amazon.com Inc’s rapid expansion in India.

Reuters has quoted industry surveys as saying e-commerce could contribute up to 4 per cent to India’s economy by 2020 from under one per cent now.

Global online retailers like Amazon and eBay are currently banned from selling products they have sourced themselves, and must rely on third-party suppliers. Their platforms, which they own fully, are marketplaces for these outside suppliers.

The Chinese Alibaba’s direct rivals in India would be Flipkart, fashion e-tailer Jabong, and global giants Amazon and eBay Inc.

Alibaba’s IPO, which could fetch more than $22 billion, expected to be the world’s largest ever, is scheduled to price Thursday night. The expected price range is $66 to $68 per share.

Yahoo is a minority investor in Alibaba with a 22 per cent stake.

The Indian e-commerce market was worth $13 billion in 2013. Online sales of retail goods in India totaled $1.6 billion in 2013, according to research firm Forrester, and are expected to reach $76 billion by 2021, Technopak said.

 

TBP

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