Hailing its portfolio companies Flipkart and Paytm, Masayoshi Son, founder, and chairman of Japanese investment conglomerate SoftBank claimed that these companies have the leadership position with majority market share in e-commerce and digital payment segment respectively.
Announcing Softbank’s quarterly report, Son said, “Flipkart, India’s number one e-tailer has 60 per cent share in the domestic e-commerce market and is bigger than Amazon India. It is very difficult to see someone who is bigger than Amazon. I believe, after China in terms of size, India should be next, and in a market with such huge potential Flipkart has 60 per cent market share which is a good start.”
Softbank had collectively invested $3.9 billion in Flipkart and Paytm. Home-grown e-tailer Flipkart reported having outrun Amazon in festival sales held in September this year. Flipkart reported generating around Rs 5000 crore in its first festive season whereas Amazon did the sale of around Rs 2500-3000 crore.
Business Standard was the first to report son’s statement.
According to Son, Paytm controls 58 per cent of the digital payments market with 230 per cent growth year-on-year in the 12 months to March 2017. The Noida-based company registered unprecedented growth after government’s demonetization effort.
“In China, Alipay has been successful as a business model and Alipay and SoftBank support Paytm. Again, thanks to the Alibaba Group, we are the second-largest shareholder in Paytm,” Son stated.
While Paytm had outrun other home-grown digital payment companies including Freecharge and MobiKwik, the Alibaba-funded company is slated to face stiff competition from foreign players including Google’s Tez, Paypal and upcoming in-chat payment service from instant messaging giant WhatsApp.
Softbank is bullish about the growth of Flipkart and Paytm, however, in the past, it had suffered the huge loss on its bets on Snapdeal and Housing. The Tokyo-headquartered investor had written-off nearly $1 billion in Snapdeal. It also tried to merge beleaguered e-commerce marketplace with Flipkart. However, it didn’t materialize.