From Japan's richest man to Jeff Bezos, everyone wants a piece of India's booming online retail sector. For those without billions to pump into the tightly held firms who dominate e-commerce, the best bet may be the delivery men.
On Tuesday, SoftBank Corp Chief Executive Masayoshi Son joined Bezos's Amazon.com in pledging heavy investment in an e-commerce industry worth $10 billion and seen quadrupling in five years. Son's gambit: a stake in Snapdeal, India's third-biggest online marketplace.
Yet the little-known firms that deliver goods ordered online are already raking in rocketing earnings from e-commerce in a country with the world's third-biggest Internet user base, and they're listed. Shares in companies like Transport Corp of India and Gati have surged more than three-quarters this year as industry watchers seek a chance to invest.
"When you see the limitless growth in the e-commerce sector, you do want to get involved," said Eric Mookherjee, a Paris-based fund manager at Shanti India, whose holdings include Transport Corp. "The next Alibaba or Tencent can be created in a country whose population is roughly similar to China. You will get that in India."
Finance house Nomura estimated in a research note in July that India's e-commerce industry could more than quadruple to $43 billion over the next five years, driven by online retail.
Pledging to invest $10 billion in India in the next 10 years, SoftBank's Son on Tuesday said Snapdeal has the potential to become India's Alibaba, the recently listed Chinese e-commerce giant. Son is well placed to know: his fast-growing Japanese telecom and media empire is the biggest Alibaba investor.