Flipkart, the pioneering Indian e-retailer that has seen popular success but is yet to show a profit, on Sunday announced that it will cross the $1 billion (over Rs6,100 crore) mark in sales this year, a year ahead of schedule, amid increasing internet penetration and the willingness of youngsters to shop online.
Founded in 2007 by two ex-Amazon employees and university friends, Flipkart has become India's biggest shopping portal hit and has drawn backers such as New-York based venture capitalists Tiger Global Management LLC.
"In March 2011 we announced by 2015 we wanted to hit $US1 billion in sales when they stood at just $US10 million," said founders Sachin Bansal and Binny Bansal, who happen to share the same surname but are unrelated.
Now the privately-held firm expects to hit $1 billion in sales "one year before our target", which means "we've grown 100 times in the last three years," the pair, who pool operational responsibilities, said in a statement.
The figures reinforce Flipkart's leadership position in the Indian e-retail market.
The founders, now both 32, said they were "happy and proud" at the progress of Flipkart in which they invested an initial $10,000.
The Bansals are seen as typical of the new risk-ready breed of entrepreneurs that has emerged in India amid years of fast economic growth, relying not on inherited wealth but their own-start up talents to launch businesses.
While there were already Indian online sellers, Flipkart helped sales take off by allowing customers to pay cash-on-delivery. While an increasing number of Indians are going online, they are uncomfortable giving credit card details over the internet – or generally prefer to pay cash, as plastic penetration is not very deep.
Flipkart began by selling books but then expanded to mobile phones, televisions, cameras, computers and home appliances.
It has yet to report a profit in the fiercely competitive market, with its nearest rival, eBay-backed Snapdeal, targeting $1 billion turnover by 2015. The world's biggest online retailer, Amazon, also entered the market last June. And months after putting retail store plans in India on hold, the world's largest retailer, Walmart, is readying a major e-merchandising push in the country based on the Amazon model. (See: Walmart readying to slip back into India through e-retail route).