Amazon India, Flipkart May Tie Up With IRCTC To Tap Its 21 Million Customers

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IRCTC (Indian Railway Catering and Tourism Corporation) was the first company to introduce e-commerce in India and its revenue from
Flipkart Amazon Tie Up online ticketing exceeds the total sales of Flipkart and Amazon India combined together. According to the reports both Amazon India and Flipkart are in talks with IRCTC to sell products on the IRCTC portal as they want to exploit its vast database of more than 21 million customers.

While both Flipkart and Amazon each said earlier this year that they had hit a billion dollars in annual gross merchandise value or total value of goods sold, IRCTC generated Rs 15,410 crore or nearly $2.5 billion through online ticket sales in the last financial year, up 24% from a year ago when it sold tickets worth Rs 12,419 crore. The figures are sourced from RoC filings

Amazon, which entered India a year ago, posted a net loss of Rs 321 crore while its biggest rival Flipkart more than doubled losses to Rs 400 crore.

“Tie-ups with portals like Flipkart, Amazon etc are in the process under which these portals would like to sell their merchandise through IRCTC’s portal, it being one of the largest e-commerce sites in the entire Asia-Pacific region,” said Sandip Dutta, public relations manager at IRCTC.

Despite having a monopolistic position, higher web traffic and sales, IRCTC can’t command a valuation similar to Flipkart or Snapdeal, feel experts.

“Being a government company, its slow decision making, red tapism, less innovation leads to non interest by investors, which in turn leads to a lower valuation. Margins of travel are much lower than margins commanded by selling goods online too,” said Rakesh Nangia, founder and managing partner of Nangia & Co, a tax and transaction advisory firm.

IRCTC had partnered with Yebhi.com  in a revenue-sharing model  last year. But the contract wasn’t renewed after its expiry.

Akanksha Samar has done her B.Tech in Computer Science Engineering from Rajastan Technical University, Kota. She is a Oracle Database Administrator, certified by PearsonVue,USA. She has sharp interests in objects like Google App Engine,Mozilla Open Project,cloud computing monitoring interface.