Infibeam gets Rs 115 crore investment from Next Orbit Ventures

The Rs 450-crore initial public offer (IPO) of Infibeam Incorporation has received Rs 115 crore investment from Next Orbit Ventures, a Mumbai-based venture capital firm. The investment means that the VC firm now owns around 5% of the e-commerce company. The amount has been invested from the first $140 million (Rs. 700 crores) fund of the venture capital firm.

Infibeam, which became the first e-commerce company in the country to be listed on stock exchanges made its market debut on April 4.

The company that operates several e-commerce services like Infibeam.com, BuildaBazaar, Incept and Picsquare, had set Rs 360-432 per share price band for the IPO but drew lukewarm response from large institutional buyers, such as mutual funds, on its debut who bought just about the number of shares that were on offer to them, which was 75 percent of the 12.5 million shares available.

Analysts read it as skepticism about the company’s prospects, in a market that is dominated by well-funded local startups such as Flipkart and Snapdeal in fierce competition with global online shopping giant Amazon.com Inc.

Ajay Jalan, founder & MD, Next Orbit Ventures, however, believes otherwise. According to him, "When other online retail companies in the market are making losses, we are very confident about our investment in a company which is ready to IPO and will be making profits in next 6 months."

Company proposes to utilise the Net Proceeds from the Issue towards funding of the following objects:

• Setting up of cloud data centre and purchase of property for shifting and setting up of registered and corporate office of the Company
• Setting up of 75 logistics centres;
• Purchase of software; and
• General corporate purposes and business expansion.