The Covid-induced online shopping growth has pushed the net profit of Cloudtail, a top seller on Amazon, by 171 per cent YoY to Rs 183 crore in FY21, data accessed from business intelligence platform, Tofler indicated.
Cloudtail India, which is a joint venture of Amazon India and Infosys founder Narayan Murthy's Catamaran ventures had earlier announced it will cease its operations from May 2022. The company's net profits during FY20 stood at Rs 68 crore.
Cloudtail, in which Amazon has a 24 per cent stake, reported its revenue at Rs 16,639 crore for FY21, a 46 per cent jump from the last financial year. The company's expenses soared to Rs 16,295 crore from Rs 11,303 crore during FY20, led by rising purchases of stock in trade, employee benefits, finance costs, depreciation and amortisation.
Cloudtail has Amazon India chief Amit Agarwal as a board of directors. It had earlier announced the seven-year-old partnership between Narayan Murthy's office and the e-tailer will cease from May 19, 2022. This came after the Ministry for Consumer Affairs issued draft e-commerce guidelines, which notified the online marketplaces can't own equity/stakes in seller firms. The guidelines also stated the marketplaces can't influence their market leadership to favour any particular seller on the platform.
Besides, the Competition Commission of India (CCI) is also investigating Amazon and Flipkart for the violation of various provisions of the Competition Commission Act after Delhi Vyapar Mahasangh, an affiliate of Confederation of All India Traders(CAIT) accused them of deep discounting, and preferential treatment to sellers.
The traders have also alleged that Cloudtail controls a majority of the inventory on Amazon, accounting for more than 90 per cent of sales on the platform.
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