PE INVESTMENTS IN INDIAN
E-COMMERCE
Submied by:
Nishit K 15PGPIM20
Udayan Samir 15PGPIM26
Yagya Sharma 15PGPIM29
Nikhil Gupta 15PGPIM38
Shankar Ananth 15PGPIM45
A CKNOWLEDGEMENT
We would like to thank Prof. N.P. Singh for his continuous guidance and support during the course. His
practical industry experiences have been instrumental in the successful completion of the project. We
would like to thank him for his guidance and encouragement which led our way and guided us throughout
the complete duration of Introduction to Management course.
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CONTENTS
INTRODUCTION…………………………………………………………………………………………………………...…………….3
TRENDS IN PE INVESTMENTS IN E-COMMERCE IN INDIA……..………….………….………….….....…..…....…......5
MAJOR INVESTMENTS OF THE TOP TWO PE FIRMS IN 2015…….………….………….………….…..…....…....…...8
SEQUOIA CAPITAL……………………………………………………………………………………………………….…………..8
TIGER GLOBAL MANAGEMENT LLC…………………………………………………………………………………….………9
TRENDS IN INVESTMENT……………………………………………………………………………………….…………………..10
TOP PE/ VC DEALS (2012 – 2015)………………………………………………………………………………………………...11
KEY DEALS IN E-COMMERCE SUB-SECORS………………………………………………………………..……….13
NEW TECHNOLOGIES TO IMPACT E-COMMERCE…………………………………………………………..……14
TYPES OF MIS REPORTS………………………………………………………………………………………………………..16
SOME PE MIS REPORTS……………………………………………………………………………………………………………...19
REFERENCES………………………………………………………………………………………………………….…………………21
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INTRODUCTION
E-Commerce or electronic commerce, deals with the buying and selling of goods and services, or
the transmitting of funds or data, over an electronic platform, mainly the internet. These business
transactions are categorized into either business-to-business (B2B), business-to-consumer (B2C),
consumer-to-consumer (C2C), consumer-to-business (C2B) or the recently evolved business-to-
business-to-consumer (B2B2C). E-Commerce processes are conducted using applications, such
as email, fax, online catalogues and shopping carts, electronic data interchange (EDI), file
transfer protocol and web services and e-newsletters to subscribers. eTravel is the most popular
form of E-Commerce, followed by eTail which essentially means selling of retail goods on the
internet conducted by the B2C category.
E-commerce has become the most attractive space for private equity (PE) investment in India,
leading to deals worth a record $11.5 billion in the entire technology sector last year, says a
report by Grant Thornton and Indian Private Equity and Venture Capital Association (IVCA).
There were also about 400 mergers and acquisitions in the technology sector, and e-commerce
accounted for 75% of the total value of such deals, up from 30% in 2012, says the report.
A large part of the total deal value consists of big ticket e-commerce PE investments along with
large cross-border acquisitions by leading IT majors. While all sub-segments within e-commerce
have garnered investor interest in terms of number of deals, e-tailers such
as Flipkart and Snapdeal, with their multiple products and brands, have driven big-ticket
investments constituting 68% of the total deal value in 2014.
India, from being merely a technology adapter or importer, is now becoming creator for
technology enabled disruptive solutions. There is a clear desire and confidence that Indians can
create unique solutions for the local market and also compete actively in the global market. What
started as an inflow of investments into e-commerce shopping portals like Snapdeal, Flipkart in
2014, transformed into a full-fledged focused strategy with aggregators
like Ola, Quikr,Foodpanda, which secured multi-million dollar investments at billion-dollar
valuations.
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Eighty percent of PE investments were under $10 million deals. With a stabilizing capital
market, stable government and hopes of new reforms, expect heightened interest from global
investors in the Indian economy in the coming year.
Top PE deals in 2014 included Morgan Stanley Investment Management, GIC, Accel
Partners, DST Global Solutions Ltd, Iconiq Capital and Sofina Capital investing $1 billion
inFlipkart Online Services Pvt. Ltd. Baillie Gifford and Co., Greenoaks Capital, Steadview
Capital,T. Rowe Price Associates, and Qatar Investment Authority and existing investors infused
another $700 million in Flipkart. Softbank Corp. invested $627 million in Snapdeal, and Capital
Square Partners, CX Partners and others acquired 100% of Aditya Birla Minacs Worldwide for
$260 million.
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TRENDS IN PE INVESTMENTS IN E-COMMERCE
IN INDIA
Global Private Equity firms have off late taken a special interest in Indian start-ups. India, a
recent addition to the newly created segment of ‘newly industrialized nations’ has emerged as the
new favorite for global investors, a clearly trust worthy option to get high return on investment.
India has been included in the league of global, ripe start-up eco-systems along with countries
like the USA (clear leader by virtue of the number of start-ups per year), UK, Israel and Brazil.
With roughly 3,100 start-ups at the beginning of 2014 to a projected astronomical figure of over
11,500 start-ups by 2020, it is nothing short of a revolution.
And one industry is driving the entire start-up environment, and that too by a huge margin. E-
Commerce seems to have taken India by a storm.
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The e-commerce scene in India started when Baazee.com was acquired by global online trading
platform eBay in 2004. After a brief lull in the industry, e-commerce made a comeback with two
ex-IITD, ex-Amazon employees entering the retail e-commerce sector with a firm called Flipkart
in 2007 as an online book retailer.
This was followed the same year by Mukesh Bansal, Ashutosh Lawania and Vineet Saxena
started an online portal to customize goodies called Myntra.
A barrage of online commerce hit the Indian web servers with companies like Snapdeal, Jabong
and Zomato populating the Indian Internet servers.
A look at the top investors of 2015 so far:
Name of the PE firm Number of Deals
Sequoia Capital 26
Tiger Global Management LLC 20
