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EBay today announced the purchase of a 5.5% stake in the Paytm e-commerce market Mall, while the global company is making another effort to enter the growing Indian e-commerce market.
The two companies did not reveal the financial terms of the deal, but a source familiar with the matter told TechCrunch that EBay had invested between $ 150 million and $ 200 million in Paytm Mall, for a valuation of $ 3 billion, against less than 2 billion last year. Paytm Mall had collected about $ 650 million before today's announcement, the source said.
The agreement provides for the sale of more than one million eBay products to Paytm shopping center users, Vijay Shekhar Sharma, founder and CEO of Paytm said in a statement. "We will jointly select the inventory we want to bring here. It will be done in a month, "he added. EBay will continue to operate its e-commerce site in India, the company said.
The deal could strengthen Paytm Mall's position in India, where it is competing with Walmart Flipkart, and Amazon India. Online retail sales in India are expected to reach about $ 72 billion in three years, according to research firm eMarketer.
Paytm Mall, which is supported by SoftBank, Alibaba, Ant Financial, and SAIF Partners announced GMV sales of $ 188 million in 2018. In the last year, the sales of the e-commerce business of One97 Communications, which also manages the Paytm portfolio, lost momentum after the reduction. high customer offers, according to a Economic time report.
Like Amazon and Flipkart, Paytm Mall uses an inventory-based model in India, but in recent months it has focused on offline and online models , in which orders placed by customers are processed from local brands. stores. A second source told TechCrunch that Paytm Mall intended to aggressively develop non-inventory based models. Paytm Mall claims to have more than 100,000 vendor partners on its platform.
This is Ebay's third investment in India. The company made its first investment in the country in Snapdeal in 2013, then on Flipkart. After the Indian company was bought by Walmart for $ 16 billion, EBay sold its stake for $ 1.1 billion and relaunched its e-commerce site, with cross-border commerce becoming its new center of interest.
"We are deeply committed to India and believe that there is tremendous growth potential and opportunities in this dynamic market," said Jooman Park, Senior Vice President, ABay Business of Ebay. "This new relationship will accelerate our cross-border business efforts in a rapidly growing market, providing hundreds of millions of Paytm and Paytm Mall customers with access to the unmatched selection of EBay products."
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