Delhi is next battleground for online grocery majors BigBasket, LocalBanya

New Delhi: Delhi will be the next battleground for online grocery majors BigBasket.com and LocalBanya.com. Online grocery shopping is yet to catch on in the national Capital and both these e-commerce companies are arriving here next month to change the way Delhiites do their grocery, veggie and staples shopping.

Online grocery stores have been growing exponentially, much like other e-commerce businesses, but competition is expected to pull its act together pretty soon - there has been growing buzz of e-commerce biggies like Amazon and Flipkart mulling entry into the groceries space. A report in Mintnewspaper this morning says Godrej Nature's Basket may have bought online grocery store Ekstop.com though neither company has confirmed it.

For online grocery stores, funding was earlier a bit of a challenge, but things have improved as the business is growing exponentially. BigBasket.com (Innovative Retail Concepts Private Limited) already claims to be India’s largest online food and grocery store with over 10,000 products. Co-founder Hari Menon told Firstpost that a third round of funding of Rs 100 crore has already been tied up. The company raised around Rs 275 crore in two previous rounds of funding.

Menon said the imminent arrival of e-commerce biggies does not scare him because deep pockets alone is not enough to succeed in this business. "The important thing is to have a deep understanding of this business. Besides, the total Indian groceries' market is $300 billion so there is enough space for everyone".

BigBasket is eyeing Rs 850 crore gross merchandise volume (GMV) in FY16, an almost three fold growth from the Rs 275 crore runrate it has already achieved on an annualised basis. LocalBanya, the other online store, is looking at Rs 150 crore GMV by the end of this calendar, up almost four fold from the Rs 40 crore it expects to reach by March.

Managing Director of LocalBanya, Karan Mehrotra said, $20 million in fresh funding is being negotiated with new investors and the deal will be sealed soon. Mehrotra comes from a family of institutional distributors of FMCG products in Mumbai. When he took over the business in 2008, at some point realisation struck that because of the nature of the credit cycle, at any given point in time four times the amount which was his company's turnover was stuck as credit with large distributors. Typically the credit cycle ranges from 30-60 days.

This was unacceptable to Karan. He started thinking of ways to break this credit puzzle. Just around that time, a Gujarati neighbour asked him if he could procure 'Surti Kolam', a special kind of rice eaten by the Gujaratis since she could not find it in the regular kirana shops.

"We sourced this rice from APMC, 25 kgs of it. She was so happy that she started doing all grocery shopping from us. This compelled me to think in terms of a grocery business which supplies to individuals, not just institutions, where there are no prolonged credit cycles. By late 2011, I had a business model for taking grocery shopping online ready and we went to market by late 2012," Mehrotra said. LocalBanya.com has raised $20 million in two rounds of funding already and plans to raise almost the same amount afresh.

But Hari Menon of BigBasket.com is a veteran who, along with four other partners has both offline and online retail experience. The same team had earlier set up India’s first e-commerce site FabMart.com in 1999 and then established the Fabmall-Trinethra chain of more than 200 grocery supermarket stores in southern India. Trinethra was sold to Aditya Birla Group in 2006 and currently operates under the brand name ‘More’.

Menon said breakeven was a good 24-36 months away even as traffic on the site has increased every month - typical weekend orders stand at 7200 a day. The store operates in Mumbai, Hyderabad and Bengaluru already, has launched in Pune last month, comes to Delhi in March and Chennai by February end.

Mehrotra said LocalBanya.com will be in 12 cities by the end of this year. It operates in Mumbai and Pune as of now, Delhi by mid-March, Hyderabad by June and Chennai or Kolkata by next year.

Competition to these online grocery stores will come not only from new entrants Amazon and Flipkart but also from existing large grocery chains going online. Reliance, Nature's Basket, Spencer's are all going online too.

Snapdeal is going all out to beat rival Flipkart: First stop, high fashion site Exclusively.in

If you thought Flipkart's end of year targets were challenging, get a load of Snapdeal!

Flipkart may be planning to double its gross merchandise value to $8 billion by December, but Snapdeal is looking to beat India's largest e-tailer as it is targeting $10 billion in GMVs (total sales value of the merchandise sold through the marketplace in a period) by the end of the year.

That's a four time increase from its current GMV of $2 billion. Little wonder that the company is gung ho about its latest acquisition of Indian luxury and lifestyle products site Exclusively.com, which will not only strengthen its fashion business but also help it reach $2 billion in gross merchandise volume (GMV) in the category in 2015.

In fact Kunal Bahl, co-founder and chief executive officer of Snapdeal expects Exclusively.com to become a $1 billion business for the company in the next three years. The aim is to establish India's first online luxury mall.

" There’s a certain percentage of our existing 40 million users who aspire to buy at least one luxury fashion product. We are making luxury available at their doorsteps," Bahl told theBusiness Standard.

"Electronics, one of the largest contributors to Snapdeal's sales, is estimated to become a $5-billion business, followed by fashion at $2 billion. The remaining will come from other categories put together," a company executive was quoted as saying by the Business Standard.

Currently, Exclusively.com retails products from designers like Manish Malhotra, Tarun Tahiliani, Manish Arora, Anita Dongre, Rohit Bal, Shivan & Narresh, Gaurav Gupta, JJ Valaya, Ritu Kumar, Varun Bahl, and Neeta Lulla, to name a few. This year, the company plans to launch leading international luxury brands and designers on its site.

So far Exclusively.com had raised over $18 million in funding from Accel Partners and Helion Partners. In November 2012, Myntra acquired Shersingh, a private label developed by Exclusively.com.

As part of the acquisition, Exclusively will complement Snapdeal’s existing ecosystem and will provide a consolidated offering for the luxury and lifestyle shopper. It will continue to function as an independent site and all aspects of Exclusively’s online shopping experience will remain intact -- with new collection and service augmentations in the pipeline. Snapdeal on the other hand will help the company scale up and expand its current business and reach.

"With Exclusively’s fashion experience and Snapdeal’s scale of operations, we look forward to not just servicing large metros, but also the aspirational demand in smaller towns across India,” said Mohini Boparai-Guleria, co-founder, Exclusively.com.

The acquisition of Exclusively is similar to that of Snapdeal's rival Flipkart acquiring online fashion retailer Myntra for an estimated Rs 2,000 crore deal in May 2014, marking it the biggest consolidation in the domestic e-commerce space and the deal comes at a time when others in the e-tail sector are expanding their presence acquisition of firms in niche categories. And while rival Flipkart raised $2 billion last year and is on course to raise another #500 million, Snapdeal raised about $1 billion in the same period, most of which came from Japan's SoftBank ($627 million).

SpiceJet to increase frequencies in summer schedule

New Delhi: Budget passenger carrier SpiceJet on Wednesday announced that it will operate new flights and increase frequencies in its new summer schedule effective from March 29.

According to the airline, it will increase frequencies on routes such as Delhi and Amritsar, Bengaluru and Mangaluru, Mumbai and Jabalpur and Delhi and Jabalpur amongst others.

"The new frequencies on the domestic sectors reflect our confidence that future growth and value lies in providing more connectivity to non-metros and tier 2 cities," said Sanjiv Kapoor, chief operating officer, SpiceJet 

On the international front, the airline said that it will introduce new daily flights to Dubai from Amritsar and Mangaluru, taking its total service to Dubai to seven flights daily. 

"The new flights to Dubai are a reflection of our success in that market, and will utilise all of our available traffic rights to the city," Kapoor said.

The company is also offering "extra legroom" economy class seats known as SpiceMAX on all of the new flights.

The company said that as part of the new schedule it is suspending services to six cities, namely Aurangabad, Belgaum, Indore, Lucknow, Surat and Thiruvanathapuram. 

The airline added that services to these cities may resume at a later date as SpiceJet adds more aircraft to its fleet.

Apple, first firm with capitalisation of over $700 bn

San Francisco: Shares of tech giant Apple surpassed $122, making the firm the first company in world history to exceed $700 billion in capitalisation at the close of a trading day.

The Cupertino, California-based company had exceeded $700 billion in capitalisation on a previous occasion, but this is the first time that it remained above that level at the close of trading Tuesday.

Apple's value at the close on Wall Street stood at $710.7 billion.

Investors use stock market capitalisation, which is calculated by multiplying the price of one share at the day's market close by the total number of outstanding shares, to determine the value of a company.

The value of the firm is almost double that of the three next largest companies in the Standard & Poor's 500.

Oil major Exxon Mobil, the second largest company in the world, is valued at $385 billion, while Berkshire Hathaway weighs in at $370 billion and Microsoft at $349 billion.

Apple surpassed $600 billion in capitalisation in August 2012, after moving above $500 billion the previous February.

Most analysts believe that Apple shares are headed still higher.

Some, like Ben Retizes with Barclays, predict that the tech firm's shares will continue rising to the $150 level.

Optimism about Apple's prospects skyrocketed after the company presented its new iPhone models last September, a move that enabled the company to take in record earnings of $18 billion during the fourth quarter.