The ongoing e-commerce war spilled over to Twitter on Friday, when Sachin Bansal, co-founder of India’s largest online retailer Flipkart, made a direct jibe at competitors – Snapdeal and Paytm. Bansal tweeted, “Alibaba deciding to start operations directly shows how badly their India investments have done so far.” Recently, Chinese e-commerce giant Alibaba, which has stakes in Snapdeal and Paytm, expressed interest in entering India directly this year.
Alibaba deciding to start operations directly shows how badly their Indian investments have done so far
— Sachin Bansal (@_sachinbansal) March 25, 2016
Snapdeal’s co-founder Kunal Bahl was quick to respond to his arch-rival’s tweet, saying, “Didn’t Morgan Stanley just flush $5 billion worth market cap in Flipkart down the…”, accompanied by a toilet emoticon. “Focus on your business, not commentary,” Bahl tweeted. His comment come on the back of Wall Street powerhouse Morgan Stanley recently marked down Flipkart shares by 27%, bringing down the country’s most valuable privately held tech firm’s its valuation to around $11 billion from $15.2 billion.
Didn’t Morgan Stanley just flush 5bn worth market cap in Flipkart down the ?? Focus on ur business not commentary 🙂 https://t.co/8NpkhWWo2j
— Kunal Bahl (@1kunalbahl) March 25, 2016
This is not the first time Bahl and Bansal have locked horns publicly. Last year, Bahl had said in an interview that he will top Flipkart’s gross merchandise value or GMV by the end of 2015. Flipkart responded immediately through another interview, indicating it will remain the number one player in the Indian e-commerce market.
Alibaba holds around 5% stake in Snapdeal and nearly 40% – directly and via its arm Ant Financial – in online payments major and e-tailer Paytm.
The Indian online retail market is seeing a hotly contested battle being fought among the domestic players like Flipkart, Snapdeal, Paytm and the Jeff Bezos-led Amazon. “This shows that none of the existing e-commerce players show leadership of the market. That’s what makes it such an easy decision for Alibaba to enter. Almost $7 billion of investment has gone and yet there’s no winner in sight. So it’s not just a reflection on Snapdeal and Paytm but the whole sector,” an investor in multiple consumer internet companies said.
Indian e-commerce companies have so far been burning millions of dollars in cash on discounting, logistics and marketing to get to a substantial scale. These subsidies have been financed by investors who have ploughed more than $3 billion and $1.5 billion in Flipkart and Snapdeal, respectively. But with the overall funding environment tightening globally and in India, from here on it won’t be easy for these players to rack up financing and consolidation in the market looks imminent.
This article was originally published in Times of India