Shopee, the ecommerce branch of Southeast Asian internet behemoth Sea Group, is shutting down its operations in India.
The company acknowledged to Tech in Asia that its early-stage Shopee India effort had been discontinued. “We will focus on assisting our local seller and buyer communities, as well as our local team, during this period of transition to make the process as easy as possible,” it said in a statement.
At a company-wide town hall on Monday, the ecommerce company informed its local workforce of its decision to leave India.
One of the individuals stated that Shopee’s pullout from India comes as the platform looks to minimise its burn rate and close newer regions that aren’t “slam dunk” successes.
According to another source, the company’s user base in India had been rapidly rising prior to its decision to cease operations. In March, Shopee had approximately 12 million active users in the country, up from around 1 million in October 2021.
The share values of Indian companies, notably tech behemoths, are declining, owing in part to a volatile market caused by the current geopolitical environment. Other Indian tech firms, such as food delivery business Zomato, beauty ecommerce portal Nykaa, and financial firms Paytm and Policybazaar, have also seen their stock prices fall by 35 percent to 50 percent since their IPOs.
Sea uses Tencent cloud to store data, and its gaming unit Garena licences most Tencent titles, resulting in large royalties, according to CAIT Secretary General Praveen Khandelwal. He went on to say that the investment ensures a high level of data control and access.
Shopee shut down its operations in France earlier this month, after arriving in the country in October 2021 as part of its European expansion. According to Tech in Asia, the service was only a short-term, preliminary experiment, and the corporation opted not to continue with it.
By the end of the year, Shopee was expected to have a positive adjusted EBITDA (before accounting for headquarters costs) in Southeast Asia and Taiwan. However, the company’s development into other areas such as Latin America and Europe resulted in growing prices.