Japanese telecommunications and internet giant Softbank Group announced on Tuesday that it invested $627 million in Indian online retailer Snapdeal, making it the largest investor in the e-commerce firm.
Softbank, a major shareholder in Yahoo! Japan, U.S. carrier Sprint and recently listed Chinese e-commerce giant Alibaba, said the deal aims to strengthen its presence in India and leverage synergies with its network of Internet companies around the world.
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"We believe India is at a turning point in its development and have confidence that India will grow strongly over the next decade. As part of this belief, we intend to deploy significant capital in India over the next few years to support development of the market," said Masayoshi Son, chairman and CEO of Softbank.
New Delhi-based Snapdeal, a website where local and international retailers can list their merchandise, counts BlackRock, Temasek and eBay among its investors. Founded in 2010, the website now has 25 million subscribers and 50,000 businesses selling on its platform.
Softbank's investment is the largest in India's e-commerce sector after rival Flipkart raised $1 billion in July, according to Reuters.
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The country's e-commerce market is witnessing rapid growth, thanks to rising disposable incomes and greater internet penetration. However, competition is intensifying as players offer heavy discounts and embark on high-voltage advertising campaigns.
The industry is forecast to quadruple to $43 billion over the next five years from $10 billion in 2013, according to Nomura.