Online marketplace to list shares in very first IPO by India e-commerce startup

India's Infibeam will strike the capital market next Monday with a 4.50 billion rupees ($67 million) initial share sale, the first home-grown e-commerce firm to go public, serving as a harbinger for the dozens of online endeavors wanting to list in future.

Infibeam's listing strategies come at a time when e-commerce is growing on the planet's 2nd- most populous nation where millions of Indians buy clothes to electronics to groceries online, using cheap mobile phones. Morgan Stanley forecasts the value of India's e-commerce market to jump 7 times to $119 billion in the next four years, helped by enhancing Internet penetration and increasing variety of online shoppers.

The share sale likewise can be found in the wake of a revival in the IPO market, where listings had dried up since 2010 amidst an economic slump.

Numerous Indian companies, consisting of the owner of India's most significant airline company IndiGo and the nation's greatest coffee chain, have actually just recently raised funds through initial share sales to fund their growth, showing rebounding investor confidence in the south Asian country's assets following Prime Minister NarendraModi's efforts to initiate a variety of reforms. Infibeam, which runs an online market that sells everything from clothing to books, electronics and accessories, has set a price range of 360 rupees to 432 rupees per share for the public offering of stock on the National Stock Exchange and the Bombay Stock Exchange, the Gujarat, western India-based Company said in a statement.

The subscription period for the offer will run from March 21 up until March 23, it said in a filing with the capital markets regulatory authority. The company plans to use the funds to construct data centers and established more logistics and warehousing facilities and buy software application, it stated. The share sale is handled by SBI Capital Markets and Elara Capital.

Begun in 2007 by an ex-Amazon.com executive Vishal Mehta, Infibeam likewise has a services company which offers subscription-based software application, web hosting and logistics tools.

The company faces stiff competition in India's fierce e-commerce market with large venture fund-backed gamers such as Flipkart Internet, Snapdeal.com, and the local system of Amazon.com grabbing a lion's share of the marketplace.

For Mehta, who developed the company without any support from foreign venture funds, it is an uphill job to produce a specific niche.

"Our own design is such that it permits the seller to use my backend and we provide them a store front. When you are selling on other marketplaces we don't charge you additional," Mehta told press reporters. "There will constantly be numerous market places. You may get the volume at first if you go to the most affordable expense market location, but exactly what stands the test of time is your own front end."

Mehta is also confident of the evaluation of his company even as the industry faces a course correction, specifically after the huge mark down in the value of India's biggest ecommerce company Flipkart in 2014 by among its high-profile financiers Morgan Stanley.

Posted on April 15, 2016 by Admin |  32 comments