Alibaba furthers India expansion with US$177m deal for 36pc stake in Paytm E-Commerce

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Alibaba Group’s US$177 million investment in Paytm E-Commerce, reflects its second major regional expansion since April 2016. Photo: Bloomberg

Published: 8:30pm, 3 Mar 2017Updated: 10:54pm, 3 Mar 2017

Alibaba Group is investing US$177 million in Indian online retail giant Paytm E-Commerce, which would swiftly expand the Chinese company’s operations in the world’s sixth-largest economy.

“India is an important emerging market with great potential. We are committed to working with local partners with the aim of developing a long-term, sustainable business,” a spokesman for New York-listed Alibaba told the South China Morning Post on Friday.

It would mark the second major regional expansion for Alibaba since April last year, when it acquired a controlling stake in Southeast Asian e-commerce services provider Lazada Group for US$1 billion.

Alibaba Singapore E-Commerce, a unit of Hangzhou-based Alibaba, led a new investment round in Paytm E-Commerce that raised a total of US$200 million, including US$23 million from private equity firm SAIF Partners, according to a filing with the Registrar of Companies in India.

Alibaba will have a 36.31 per cent stake in Paytm E-Commerce, while SAIF will take a 4.66 per cent interest.

Signage for Ant Financial Services Group's Alipay payment system is displayed on a store entrance in Shanghai on August 31, 2016. Photo: Bloomberg

That transaction has turned the Indian online retail provider into one of the country’s few start-ups with a US$1 billion valuation, or “unicorns”, according to Indian media reports.