By Aditya Kalra
NEW DELHI (Reuters) – India's largest retail group has asked the antitrust authority to investigate three fast-commerce companies – Blinkit, Swiggy and Zomato's Zepto – for alleged predatory pricing, a letter showed on Sunday.
Fast commerce is a new shopping craze in India, with companies promising 10-minute deliveries of anything from groceries to electronics, reshaping the way Indians shop and challenging e-commerce giants like amazon (NASDAQ:).
In a letter dated October 18, the All India Consumer Products Distributors Federation (AICPDF), which represents 400,000 retail distributors of major companies including Nestle and Hindustan, Unilever (LON:), told the antitrust body that fast-trading companies were practicing predatory pricing, or offering deep discounts and selling below cost to attract customers.
Zomato's Blinkit, Zepto and Swiggy, which runs delivery service Instamart and is backed by SoftBank (TYO:), did not respond to Reuters queries.
The letter said several consumer goods companies were dealing directly with quick-trade companies to increase their reach, bypassing traditional sellers who for decades went from store to store to deliver orders.
Such practices make it “impossible for traditional retailers to compete or survive,” said the letter, which is not public but was seen by Reuters.
“Implement protective measures for traditional distributors and small retailers to safeguard their interests,” the Competition Commission of India (CCI) urged.
The ICC also did not respond to a Reuters query and AICPDF declined to comment on its letter.
Annual sales of Indian fast commerce platforms are expected to exceed $6 billion this year, with Blinkit having a market share of almost 40%, while Swiggy and Zepto will be around 30% each, the firm said. Datum Intelligence research team.
The ICC has powers to launch an investigation on its own if it finds merit in the complaints, a government official, who asked not to be identified because he was not authorized to speak publicly, told Reuters on Sunday.
In August, the CCI's investigation unit found that major e-commerce players, amazon and Walmart's (NYSE ) Flipkart, violated local laws through predatory pricing, allegations the companies deny.
Reflecting the strength of the fast commerce sector, Zomato shares have doubled this year and Swiggy will launch its $1 billion-plus initial public offering in the coming weeks.
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