e commerce september 2013

8/20/2019 E Commerce September 2013

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E-Commerce :

India’s next big opportunity or a bubble?

September 2013



• Executive Summary

• Sector Overview

• Evolution of E-Commerce in India

• Enablers of E-Commerce

• Business Models & Key Players

• Segment Analysis

I. Online Travel – Largest Segment

II. E-Tailing – Fastest Growing Segment

III.Classifieds

IV.Other Segments

• Michael Porter’s Analysis of the E-Commerce Industry

• Changing industry dynamics due to entry of Amazon

• Next big opportunity or a bubble?• Profiles of Major Players

I. Private Players

II. Public Players

• M&A in Indian E-Commerce

• Most Active Investors

1

Index



2

Executive Summary

• The E-Commerce industry in India has come a long way since the tumultuous years of the dotcom bubble. E-Commerce has been experiencing stupendous growth in recent times which has led to a boom in the onlinetravel and E-Tailing segment in India. But the real question is whether the industry can sustain this high-growth momentum or not?

• The trend of online shopping is set to see greater heights in the coming years, not just because of India’s risinginternet population, but also due to changes and growth in the supporting ecosystem

• Earlier the flood gates were opened by online travel sites such as Indian Railway Cater ing And TourismCorporation (IRCTC) and makemytrip.com which changed the way Indians booked travel tickets. Now E-Tailingor online retailing has taken the center stage and has seen faster growth than all other E-Commerce segments

• The industry has attracted millions of online consumers by creating a secure online transactionenvironment, facilities such as Cash-on-delivery (COD), and a strong focus on customer service that led toIndian consumers placing their trust in online shopping

• The major challenges for the online industry ti ll date remain logist ics & fulfil lment and cash on deliverydependency of new customers. The logist ics part remains an external challenge which retailers cannotovercome in a short span of time. While cash on delivery is essential in a nascent E-Commerce market, itimpacts business margins negatively and increases the cash burn rates in the long-run

• At present E-Commerce companies in India have rushed to make announcements on new offerings and alsoare strategizing fast on their next move and some have even started tweaking their business models, in thewake of Amazon’s entry in India (becoming reseller of goods rather than daily deals websites)

• However, the industry is facing some tough challenges to stay afloat because only a handful of entities aremaking money if at all and investors are no longer interested to burn their money in the current price sensitivemarket which is showing few signs of recovery in the next few years

• The industry is reaching a phase of consolidat ion as many mult i-category players such as Flipkart andSnapDeal have started acquiring niche players in order to widen their offerings and about. Approximately, 70%of venture-funded Indian E-Commerce companies are expected to disappear over the next one year or so, asthe local industry undergoes significant consolidation (acquired or shutdown)

• As the Indian E-Commerce space becomes more and more crowded, it is imperative for investors to look atnew “white spaces” in this sector such as a specialized logistics providers to the E-Commerce industry or players offering innovative products / services. Also, investors are going back to the basics quickly and are onlywilling to back those existing players who possess robust business models and visible profit margins and havea clear path to provide an exit

The current size of theIndian E-Commerceindustry is US$ 9.48

Bn and it has grown ata CAGR of 35% duringthe past 3 years

Online travel is thelargest segment inIndia constituting~73% of the total E-Commerce marketfollowed by E-Tailing, financialservices andclassifieds whichconstitute14%, 6% and5% respectively



3

Sector Overview

Sector Overview in India

• India has an internet user base of ~150 mm as of Feb 20131. Thepenetration of E-Commerce in India is low as compared to markets

such as China (at 575 mm) and the US (275 mm)

• The internet penetration in India remains at 12% versus 43% in Chinaand 80% in the US, and in terms of internet speed India ranks 109th

• However, the low penetration means that India presents anunprecedented growth opportunity for the Internet sector in thecoming years

• India is likely to see a golden period of the E-Commerce sector growth between 2013 to 2018, the questions is whether it wi ll be

profitable

Market Size (US$ Bn)2

• Increasing broadband Internet services and growing 3G penetrationin India

• Rising standards of living and a burgeoning, upwardly mobile middleclass with high disposable incomes

• Lower prices compared to brick and mortar retail model driven

by disintermediation, reduced inventory holding and real estate costs

• Busy lifestyles, urban traffic congestion and lack of time for offlineshopping

• Evolution of the online marketplace model with websites such asFlipkart, Snapdeal, ebay etc. has come a full circle with marketplacemodels taking center stage

Key Drivers of E-Commerce Market Segmentation (Dec 2012)

3.85

5.26

7.03

9.48

12.60

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth 33%

1 2013 India Internet Outlook, Techcircle.in2 Internet and Mobile Association of India, April 2013

Online TravelIndustry

73%

E-Tailing14%

FinancialServices

6%

Classifieds5%

Other OnlineServices

2%

Total Market Size ~ US$ 9.48 Bn

Dominated byonline travelindustry

Calendar Years



4

Evolution of E-Commerce in India

Evolution story

Launch of internetin India via dialup in6 cities

August 1995

Launch of onlineB2B and onlinematrimonial portals

1996

Launch of online job portals

1997

1st wave (1996-2000)

2000 2005

Muted activity inthe industry due todotcom bubble in2000

2006

Launch of onlinetravel agents(OTAs)

2007

Entry of a largenumber of bigplayers in E-Tailingsegment

2010

Launch of firstgroup buyingwebsite in India

New trend of using

social networkingsites (SNS) as amarketing toolbegins thus leadingto the advent ofsocial commerce

2nd wave (2006 – present)

1st Wave – Advent of online sites Naukri.com and Shaadi.com

2nd Wave - Duplication of global business models (“me too” strategy) and improvement in the ecosystem



5

Enablers of E-Commerce

Source:- McKinsey, Online and upcoming: The Internet’s impact on India Dec 12

• India’s fast growing base of ~150 million Internet users is currently the third largest in the world, and the pattern of online behavior is rapidlyconverging with that of users in developed countries

2300

480245

120 102

34%38%

77%

10%

80%

0%

10%

20%

30%

40%50%

60%

70%

80%

90%

0

500

1000

1500

2000

2500

Global China UnitedStates

India Japan

Internet Users % Penetration

2662

583

279 350105

43%43%

86%

28%

84%

0%

10%

20%

30%

40%

50%60%

70%

80%

90%

100%

0

500

1000

1500

2000

2500

3000

Global China UnitedStates

India Japan

Internet Users % Penetration

Internet Users and Penetration (2011) Internet Users and Penetration (2015)Internet penetrationbased on current population is expected tosubstantially increase

within the next 2-3 yearsfrom 10% at present to28% by 2015

India’s projected 330 million to 370 million Internet users will form the second - largest Internet pop ulat ion in the world b y 2015

Acceptance of onl ine payments by Indian Consumers

Direct Debit58%

Visa21%

MasterCard12%

Cash / COD7%

All others2%

Advent of smart -phones leading to m -commerce

Smart Phon e Users in India (Mn)

40

250

450

2012 2015 2020



Business Models & Key Players

C2C

• Online Classifieds• Online Retail

B2C

• Online Travel• Online retailing/E-Tailing• Online Classifieds• Digital Downloads• Financial Services

B2B

• Online Classifieds

Online Travel

Customers buytickets, book hotels andpurchase tour packagesonline. The ticketingservices can be forairlines, railways orbuses

Modes of E-Commerce transactions

Generates bulk of revenues

Currently small, set to grow withthe entry of several players

Most common users are SMEs

E-Tailing

Online sale of productssuch as books, mobilehandsets, mobileaccessories, electronicsand home and kitchenappliances among others

Online Classifieds

Portals connectingbuyers and sellers byproviding classifiedsspace where the sellerscan advertise theirproduct, jobs etc.

Financial Services

Online sale of insurancerelated services, utilitybill payments, onlinetransactions such aspurchase / sale of sharesand securities

Other Online Services

Includes services suchas online entertainmentticketing, online fooddelivery, online grocerydelivery



Segment AnalysisI. Online Travel – Largest Segment

Segment Size (US$ Mn)2

Domestic AirTickets

50%

Railway Tickets39%

International Airtickets

6%

Hotel Bookings2%

Bus Tickets2%

TourPackages/Trav

el Insurance1%

Total Market Size ~ US$ 6.9 Bn

Segment Composition (Dec 12)

Segment Overview

Market Share Analysis1

• The growth in India’s travel and tourism industry is the secondfastest worldwide and India is poised to be among the top five civil

aviation markets in the world over the next decade

• The growth of the services sector (driven by rising householdincome, an expanding middle class and more inbound andoutbound tourism) is responsible for this rapid growth in the onlinetravel booking segment

• As the inter city migration has increased, a proportional upwardtrend is seen in usage of transport including railways and air travel

• Low entry barr iers in the online travel market have resulted in anumber of small players entering this space. The market is now

cluttered with a mix of large Indian Online Travel Agents (OTAs), aswell as several small players and international players

48%

24%

18%

10%Others

1 Makemytrip.com, Company presentation2 Internet and Mobile Association of India, April 2013

* Numbers take into account Indian Online Airline Market

2.99

4.09

5.32

6.91

8.99

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth33%

Calendar Years



Segment AnalysisII. E-Tailing – Fastest Growing Segment



Books4%

Apparels +Footwear

21%

Jewellery4%

Cameras14%

ConsumerDurables

8%

HomeFurnishings

3%Mobile phones

19%

Laptops/tablets24%

OthersProducts

3%

Total Market Size ~ US$ 1,292 Mn

310475

769

1,292

2,002

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth55%

Segment Overview

• The online retail/E-Tailing industry clocked revenues of US$ 1,292Mn in 2012, growing at 68%, a rate faster than any other E-Commerce segments

• The segment is expected to touch revenues of US$ 2,002 Mn by theend of 2013 and is also expected to match the revenues of thelargest segment, Online Travel, in the coming few years andthereafter, surpass it quickly

• Players that emerged as category leaders were those that were ableto penetrate their target market deeply to offer a large range of products by spreading their operations beyond the top cities

• There has also been consolidation in the market, with larger playersacquiring small single-category ones to enhance their portfolios (for example, SnapDeal’s acquisition of eSportsBuy.com)

Challenges in the E-Tailing market

• Lack of touch and feel - a mental barrier for online shopping

• Lack of touch and feel in online shopping could lead toissues such as wrong product sizes, higher returns

• Increased competition with the entry of global players

• The advanced technological capabilities of global players inareas such as customer analytics and recommendationengines would pose a challenge for local companies

• Low margins prompting E-Commerce players to look at newbusiness models

• A majority of E-Commerce companies are price players dueto the stiff competition they face and the race to acquire themaximum number of eyeballs. This results in very lowmargins or none at all

1Internet and Mobile Association of India, April 2013

Calendar Years



1 EY, Rebirth of E-Commerce in India

9

Segment AnalysisII. Online Retail – Structure

Online Retail

Vertical Focused Players Multi-Category players

• Deal in specific category of goods such as apparel, electronics andbaby products

• Deal in multiple categories of goods

Fashion & Lifestyle

Babies, Kids & Mother-care

Electronics, Gadgets, Watches & Phones

Jewellery

Furniture, Furnishings & Home Decor

Verticlefocused players

54%

Multi-CategoryPlayers

46%

Revenue ~ US$ 769 Mn

Revenue Mix (2011)1



Segment AnalysisIII. Classifieds



155

217

337

471

613

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth30%

Online Jobs59%

OnlineMatrimony

22%

Other B2CClassifieds

7%

B2B Classifieds13%

Total Market Size ~ US$ 471 Mn

Overview

• Overall, the classified market in India will be driven by the growth

in the services sector, favorable demographics and growth inadvertising

• The Classifieds market comprises of two segments :

Online Classifieds Offline Classifieds

• Comprises of extensive adspace and structure

• Longer messages and useof graphical text

• Newspapers comprise amajor part of this segment

• Ads are typically short andare charged on the basis of

number of words and aremainly text with no graphics

Major Types of Classifieds

Recruitment Services

Real Estate Advertising

Matrimonial Services

Automobile Advertising

1Internet and Mobile Association of India, April 2013

Calendar Years



Segment AnalysisIV. Other Segments

Segment Size (US$ Mn) Segment Composition (Dec 12)

308370

451

578

722

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth25%

InsuranceRelatedServices

29%

Utility BillPaymentsincludingMobill Bill

Payments40%

SecuritiesTrading

31%


86104

159

222

278

2009A 2010A 2011A 2012A 2013E

EstimatedY-o-Y

Growth25%

Segment Size (US$ Mn) Segment Composition (Dec 12)

OnlineEntertainment

Ticketing72%

Online FoodDelivery

23%

Online GroceryDelivery

6%


Financial Services

Other Online Services

Calendar Years

Calendar Years



Substitutes are easily available

12

Michael Porter’s Analysis of the Indian E-Commerce IndustryAttractive but highly competitive

Threat of New Entrants - High

• Products are undifferentiated

• Low initial capital investment required to setup thebusiness

• Distribution channels are easy to access

• Low consumer switching cost

Bargaining Power of Buyers - High• Large number of buyers and highly price sensitive

• Low level of uniqueness among the products makesit difficult for sellers to negotiate with buyers

• Buyers have tons of information about theproduct, which is readily available on the websitesfacilitating comparison among products

Bargaining Power of Suppliers - High• Few suppliers and a lot of buyers

• Suppliers have equal power to negotiate with thebuyers (companies)

• There remains a possibility for suppliers to forwardintegrate and start selling the products on their ownwebsites hence increasing their margins

Intensity of Rivalry - High

• A lot of players that sell similar products, combinedwith the low brand loyalty and low switching costs

• Most of the competitors have similar market shareand to increase market share is tough

Threat of Substitute Products - Medium

• Substitute products are cheaper and product quality

is equal or higher• The product performance of substitute products are

same or better

• Low switching cost makes the industry more pricesensitive

Low – Entry Barriers

Makes the industry competitive andtherefore decreases potential for

profits

There is no brand loyalty among theconsumers as they are always on the

look out for better deals

High volatility in prices of Products

The availability of long tail products(substitutes) and low switching costsgive a lot of power to buyers

High negotiating power

Suppliers have high bargaining powerbecause they are selling products thatare being sold on multiple websites



Changing industry dynamics due to entry of AmazonHow the industry will be shaped ?

• Fifteen months after the world’s largest online retailer Amazon staged atentative entry into the Indian market with the launch of Junglee.com, the US online retailer in June 2013 announced the launchof Amazon.in, a marketplace that will facilitate online transactions

between buyers and sellers in India

• Amazon has been actively lobbying with the government to relaxregulations against foreign E-Commerce firms and allow FDI in onlineretail

• In a knee-jerk reaction, major Indian portals switched from an inventory-based approach (selling themselves) to a marketplace model (offering aplatform to third-party sellers) in order to effectively compete. Snapdealhas pioneered this and are a zero inventory, managed B2C marketplace

• Though the entry of Amazon into the Indian E-Commerce market further increases the competition, on the flipside it is likely to improve the E-Commerce landscape in terms of logistics, buyer protection andconsolidation. SMEs will also get one more credible marketplace as aretail growth channel

• To counter the Amazon threat, Indian portals are cranking up sales inTier II and III cities, where Amazon will have a tough time gainingcustomers. At present, the major Indian portals claim half their customer traffic from Tier I cities, with the rest coming from Tier II and III cities

"The Amazon move furthervalidates the potential of

the Indian market andreiterates the importance

of the managedmarketplace model in

India"-Kunal Bahl, CEO, Snapdeal

“This will slow down new

capital investments in E-Commerce industry by

VCs and angels. The

industry is at a very earlystage evolution andbringing 800 pound gorilla

this early does not makesense.”

-Sandeep Aggarwal, founderand CEO of

ShopClues.com on how will Amazon’s entry affect Indian

E-Commerce players

13.17 12.65 12.43 11.92

8.45 8.11

Myntra Flipkart Jabong Amazon.in Snapdeal.com HomeShop 18

Unique Visitors (Mn) June 20131

Amazon has gained significanttraffic share within one monthof being launched

1 Comescore



Startup Rush Opportunity or Bubble?

Struggle for Survival

• The online shopping habit was initially started in 2003 by the no frillsairline Air Deccan in India which accepted bookings only through the

internet and the IRCTC

• The E-Commerce companies startedaggressive discounting and selling belowcost has enlarged the consumer appetite

but how many will end up surviving?

• The industry promoted by the spice of VCmoney added to this pot boiler and thisstarted a mad rush by startups to grow themarket and attain the number one spot bykilling competition

• The issues faced by the E-Commerce companies are no more a secretnow, large players poured in millions of dollars to build alternative to

brick-and-motor stores and spending huge sums on marketing costsbut none of them are making profits even at the operating levels

• The major challenge for theE-Commerce companiesremains customer stickiness, which in thecurrent scenario is lost duetoo many players havingsimilar business modelsand raging price

wars, leading to a downwardspiral

• The end result of thissituation is that the bigplayers haven’t been able tosee profits still, even after guzzling venture capital inthe range of $40mn to150mn each

• The cost of customer acquisition in Indian E-Commerce is very high.Normally, E-Tailing companies are spending around Rs. 1000-1200 intelevision and newspaper advertisements in order to acquire acustomer order worth Rs. 400-500

• The E-Commerce investors in India are once bitten, twice shy aboutfunding E-Commerce companies in India. An E-Commerce company

can bootstrap to a certain extent but scaling requires funds. A largemajority of them have failed in this scale - up phase

• Consumers who were shopping online so far were doing so becauseproducts were available on websites at deep discounts, andconsumers are always looking for a good deal. As E-Commercebusinesses run into funding issues, prices go up, and there is a naturalinclination for orders to drop

• Compared to the rest of the world, Indian E-Commerce is in anascent stage. Considering the vast population coupled with the

projected growth of internet users, one cannot write off Indian E-Commerce. On the other hand, in a complex market such asIndia, profits take time to see the light of the day

• The industry is here to stay but will need to go through a significantconsolidation phase over the coming few years in order to becomeprofitable and provide investors with good exits

Next big opportunity or a bubble?

• “AnOpportuni ty , but

wi l l require

innovat ion; many

exist ing players

will perish soon”



Profiles of Major PlayersI. Private Players

CompanyName

Description

Flipkart Online ServicesPvt. Ltd. is engaged inproviding internet retailservices. It offers anonl ine book retai l portalbut now also sells mobilephones, movies, games,cameras, music playersthrough its online webportal f lipkart.com. Thecompany was founded in2007 and is based inBangalore, Karnataka

Jasper Infotech Pvt. Ltd. ownsand operates the groupbuying site Snapdeal.com. Itoffers mult i-channel direc tmarketing solutions to itsclients. The company wasfounded in 2010 and is basedin New Delhi, India.

Myntra Designs Pvt. Ltd. owns

and operates online retailportal myntra.com whichoffers E-Commerce and onlinemerchandising services. It isengaged in providing anonline platform where one cancreate or buy customized giftssuch as t-shirts, mugs,calendars, watches, notepads,shorts and coaster etc . Thecompany was founded in2006 and is based inBangalore, Karnataka

Xerion Retai l Pvt . Ltd.is engaged in the retai lof apparels,accessories andfootwears. It sells itsproducts under thename Jabong andFabfurnish. Thecompany was foundedin 2011 and is based inGurgaon, Haryana.

TV18 Home ShoppingNetwork Ltd. is the onl ine &on-air retai l market ing anddistr ibut ion venture of theNetwork18 Group. I t offersinternet and multimedia retailservices in India. I t offerselectronics and computers,cameras and mobiles,

jewellery and watches, etc.The company was foundedin 2006 and is based inNoida, Uttar Pradesh.

Revenue(US$ Mn) ~300 ~400 ~100 NA ~37.5

UniqueVisitors PerMonth(Millions)

12.64 8.45 13.17 NA 8.11

DisclosedInvestment

(US$ Mn)

401.29 113.73 64.30 NA 96.75

PE Funding

Accel India VentureFund (2013)

Tiger GlobalManagement LLC(2013)

Iconic Capital LLC(2013)

MIH Holding Ltd (2013)

Indo US Venture Partners(2013)

Bessemer Venture Partners(2013)

eBay Inc. (2013)Nexus India Capital (2013) Intel Capital (2013)

Accel India Venture Fund(2012)

Tiger Global ManagementLLC (2012)

IndoUS Venture PartnersLLC (2010)

IDG Venture India Fund(2010)

NA

OCP Asia Ltd (2013)SAIF Partners Fund (2011)GS Home Shopping Inc.

(2011)Capital18 Fund (2008)

Note:- Revenues figures are only estimatesExchange Rate 1 USD = 60 INR



16

Profiles of Major PlayersI. Private Players

CompanyName

Description

Times Internet Ltd. is a softwareservices company. It offersinternet and mobile value-addedservices. The firm’s servicesinclude VAS messaging service;multimedia messaging, dating,chatt ing, and email on mobile;and e Wallet, NRI solutions,invest online, book domains,business mail, Web sitedesigning, Web hosting, salesCRM and hi re models etc . Thecompany was founded in 1999

and is based in New Delhi, India

Shop Online Trading Pvt.Ltd. is engaged in providinginternet retai l services. I toffers footwear for men,women, boys and girls. Thef irm also offers jewellery,such as anklets, bangles,waist belts, and watches.The company is based inNew Delhi. Shop OnlineTrading Pvt. Ltd. operatesas a subsidiary of Big Shoe

Bazaar India Pvt. Ltd.

Accelyst solutions Pvt. Ltd.owns and operates onl ineportal freecharge.in. Itof fers an online plat formwhere it enables the user torecharge their mobile phoneand provides discountcoupons of top Indian food

joints and retailersequivalent to the rechargeamount. The company wasfounded in 2008 and isbased in Mumbai,

Maharashtra.

Fingerprints FashionsPvt. Ltd. owns andoperates an onlineportal inkfruit.com, is anonline t-shirt store. Thefirm designs t-shirtswhich are submitted andvoted by the community.The company wasfounded in 2007 and isbased in Mumbai,Maharashtra.

Clues Network Pvt. Ltd.owns and manages anonline web portalshopclues.com which is ahorizontal E-Commercewebsite featuring a rangeof products such aswatches, electronics,sculpture items, apparelsetc. The company wasfounded in 2011 and isbased in Gurgaon,

Haryana.

Revenue(US$ Mn)

~46.671 ~10.42 NA ~30 ~50

UniqueVisitors PerMonth(Millions)

NA NA NA NA 3.5

DisclosedInvestment(US$ Mn)

13.03 NA 3.94 5.50 16.00

PE Funding

500 startups (2012)Jungle Ventures Pte. Ltd (2012) Accel India Management Co.

Pvt. Ltd (2012)Qualcomm Ventures (2012)

Merger with WhiteboardInfo media Pvt. Ltd.

Sequoia Capital India(2012)

Robe mall ApparelsPvt. Ltd (2012)

SAIF Partners Fund(2011)

Helion Advisors Pvt. Ltd.(2013)

Nexus India Capital Advisors Pvt. Ltd (2013)

Note:- Financials are on standalone basis1 The financial data is for the financial year 2011



Company Name InfoEdge

Description

Info Edge, led by Mr. SanjeevBhikchandani, one of India’s most well

recognized entrepreneurs, is India’s

premier on-line classifieds company

'With a view to tap the growing Indianmarket, it has made investments in startups such as Etechaces Consultingand Marketing Pvt Limited (PolicyBazar), Happily Unmarried Pvt. Ltd,Zomato Media Private Limited etc.

MakeMyTrip Limited is an online travelcompany led by Mr. Deep Kalra. InIndia, the Company conducts itsbusiness principally through its Indiansubsidiary, MakeMyTrip (India) PrivateLimited

-Led by Mr. V.S.S Mani, Just Dial is asearch engine company. It providesusers with information and user reviewsfrom the Company's database of localbusinesses, products and servicesacross India- The company went public in June 2013.The IPO was over subscribed 12 timesand now shares a close association withSAIF Partners, Sequoia Capital, TigerGlobal, EGCS and SAP Ventures etc.

Products and Services

- The company operates in the e -commerce space through its 9websites, some of which areNaukri.com (Recruitment),JeevanSathi.com (Matrimony), 99

Acres.com (Real Estate), Shiksha.com(Education) etc.

Its services and products include airtickets, hotels, packages, rail tickets,bus tickets, car hire and ancillary travelrequirements, such as facilitatingaccess to travel insurance

Dial a Search service, Free Listing ofBusinesses, Advertisement Services,Events Support and Mobile Apps etc.

Sub-Industry Online Classifieds Online Travel Online Classifieds

Financials (US$ Mn):

- Revenue $78.33 $225.02 $60.46

- EBITDA 27.64 (14.31) 16.81

- Net Income 15.27 (27.58) 11.41

aluation Metrics (US$ Mn):

- Enterprise Value (EV) 521.62 $463.64 $700.53

- Market Capitalization 558.55 498.16 785.49

- EV / Sales 6.66x 2.06x 11.59x

- EV / EBITDA 18.87x NM 41.68x

- P / E 36.59x NM 68.84x

17

Profiles of Major PlayersII. Public Players

Note:- Financials are for the year ending March 2013, Shares prices as on 29 August 2013, Ex-change rate for USD-INR - 60



18

M&A in Indian E-CommerceRecent Deals – Consolidation in the market & exits by Private Equity Funds

S. No. Announcement Target Acquirer Exit byDeal Value(US$ Mn)

EV/SalesMultiple

1 15-Jun-13

Pilani Soft Labs (RedBus.com) Ibibo (Naspers Group)

$138.00 ~24.34x

2 10-Apr-13

Purple E-Retail (Hoopos.com) Nest Childcare (Babyoye.com)

NA NA

3 4-Apr-12

eSportsbuy.com Jasper Infotech ( Snapdeal.com)

12.51 NA

4 9-Feb-12

eTree Marketing (Letsbuy.com) Flipkart

20 ~0.62x



19

Most Active Investors

Investor Major Investments



20

With our deep understanding of the E-Commerce industry and our professional network, we can helpyou:

Indentify categories which have high growth opportunities and companies within those

Find E-Commerce businesses to be acquired or sold

Bring strategic and financial investors to your E-Commerce business (Domestic and International)

Help your business find the most suitable partners

Provide advice on any related transaction terms, valuation and pricing

How Dinodia Capital Advisors can helpOur Offerings



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e commerce september 2013

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