India’s e-commerce sector is expected to touch USD 28 billion by FY2019-20 on account of an increase in number of buyers and stable annual spends per consumer, according to a report.
“A gradual increase in shopper base, coupled with steady increase in online spends can help the Indian e-tailers reach gross merchandise value of USD 28 billion by FY 2020. We assume buyer penetration to improve to 18 per cent by FY 2020 from 12 per cent in FY 2016, with annual average online spend to increase by 10-15 per cent year-on-year over the forecast period,” a Kotak Institutional Equities report said. It observed that the e-commerce will continue to find more takers, particularly as organised retail penetration remains limited in tier II and III cities. It noted that the growth in the e-commerce industry, which it estimates to be a compounded annual growth rate of 45 per cent over FY2017-20, will be in line with the gradual improvements in household incomes and infrastructure development.