The ecommerce giant Amazon as part of gearing up for the upcoming festive season, is all set to infuse USD 63 million into its logistics arm ATS (Amazon Transportation Services). According to documents filed with the Registrar of Companies (RoC), Amazon has also decided to increase the authorized share capital of the company to about INR 800 crore from existing INR 475 crore.The authorized share capital of a company is typically increased to allocate more funds to the company.
Recently, the company announced its plans to extend its logistics services to its sellers in India, even for orders placed through offline distribution as well as competitors Flipkart and Snapdeal. It has recently launched a pilot programme for the same, where it is reportedly working with 300 registered sellers. It was also reported that Amazon India has updated its shipping costs for sellers using Amazon Transportation Services to deliver orders to out-of-state customers. The new shipping charges, which will come into effect from August 8, 2017, are applicable under the Fulfilled by Amazon (FBA) programme.
Apart from grocery and digital payments, logistics is another growth vertical for India, poised to grow into a USD 307 billion industry by 2020. As stated in an earlier statement by the company,
“Amazon wants to build ATS into an independent logistic service which competes against Flipkart’s Ekart and other independent logistics services like Blue Dart and FedEx.”
The latest development comes at a time when the company is preparing for the annual festive season and also has a three day sale starting Wednesday. The resolution to expand its authorized share capital was approved last month. The approval for fresh capital infusion will help the company meet demands for the upcoming festive season, specifically for Prime deliveries.