India e-commerce to Increase by 27 Percent; Reliance to Capture Half of Online Grocery Sales: Goldman
The Indian e-Commerce business is expected to reach USD 99 billion, growing at a GACR of 27 percent by 2024. Goldman Sachs has also projected that Reliance industries through Facebook are likely to capture half of the online grocery sales.
According to a report, 'Global Internet: e-commerce's steepening curve', Goldman Sachs has stated that the COVID-19 pandemic has significantly surged the market for e-Commerce players globally. For instance, in just three months, consumer packaged goods have been driving as much as three years of penetration.
The reported has also projected that the online penetration of retail is expected to reach 10.7 percent by 2024, versus 4.7 percent in 2019.
"The biggest near term theme in India internet, in our view, is the foray of Reliance Industries (India's largest market-cap company with presence across sectors such as energy, telecom, and retail) into e-commerce, and the company's tie-up with WhatsApp for online grocery," it added.
With Facebook buying about 9;99 percent stake in Jio Platforms, which is a subsidiary of RIL which accommodates India’s youngest telecom and various apps, Jio Mart is expected to connect local grocery stores with customers by utilizing Facebook’s Whatsapp.
The brokerage said that the growth in India's e-commerce is likely to come from ease of shopping through WhatsApp, improving payment ecosystem, and better penetration into categories such as grocery/FMCG.
It said, "We believe RIL's partnership with Facebook could result in the company becoming a market leader in the online grocery space, with more than 50 percent share by 2024. Having said that, we do see grocery as a large category for two or more players to co-exist over time," it said.
"Overall, we forecast online grocery orders to grow from 300,000 per day in 2019, to more than 5 million per day by 2024," it added.