Tencent is on the lookout for Indian start-ups
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Tencent is on the lookout for Indian start-ups

Chinese mobile gaming giant Tencent doesn’t want to get left behind. As other big Ecommerce players – like Amazon, and rival Alibaba – make in-roads into India, Tencent has started scouting around for promising Indian start-ups to invest in through its investment holding company, Tencent Holdings. The group is hoping to build a presence in what might be the next big Ecommerce market, and is already the world’s second-biggest emerging economy.

Tencent’s share price has appreciated by 84% so far this year!

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SOURCE: Yahoo Finance

Tencent’s current target is cab rental service Ola, with sources confirming that the company is in advanced stage talks to invest somewhere between $400 million and $500 million. If the deal goes through, Tencent will have managed to establish a foothold in four major segments: Ecommerce, cab hailing, messaging, and digital healthcare. The company is also in talks with Policybazaar, and while no agreement has yet been reached, this could see the Chinese internet giant gaining a position in the online insurance retailing business too.

Along with Alibaba, Tencent is one of the two big Chinese internet investors. Both companies are big on India, with Tencent pumping close to $1 billion into investments in the country already. This includes a $700 million investment in Ecommerce company Flipkart.

A source who requested anonymity explained the company’s interest in India: “Tencent believes that India is behind China by 5-10 years. It thinks that India will play out in a somewhat similar way to China, so it is placing bets early. It will start getting operationally involved in some of the companies within the next two years. Tencent will back its portfolio companies that see traction, and also wants to increase its stake in them.”

Disclosure

Dominion holds Tencent in its Global Trends Ecommerce Fund.


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