Amazon AMZN continues to make strong efforts to bolster its presence in the e-commerce market of India.
This is evident from the latest expansion of its Fresh infrastructure in the country. Notably, the company’s Fresh fulfillment capacity has more than doubled to above 1 million square feet of space.
There are 35 dedicated Fresh fulfillment sites at present across 14 cities namely New Delhi, Gurgaon, Noida, Kolkata, Bangalore, Mysore, Chennai, Hyderabad, Mumbai, Thane, Vashi, Ahmedabad, Jaipur and Pune.
The space will help the company in efficiently addressing increasing shopping of Fresh items, including groceries and essentials, with expanded storage and fulfillment capacity.
Moreover, the underlined expansion will help the company to make quick deliveries of Fresh items, which are supposed to get delivered within two hours of shopping.
Hence, with the latest expansion, Amazon will be able to deliver enhanced shopping experiences to customers.
Customers will get to shop more variety of products and brands, owing to the expanded storage capacity of the company.
Additionally, the move will help Amazon to expand its footprint in the booming online grocery retail market of India.
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Amazon’s Expansion Spree
The recent Fresh infrastructure move is in sync with Amazon’s deepening focus toward expanding its fulfillment network in India, where the online retail market holds immense growth opportunities.
Per a report by India Brand Equity Foundation, the India e-commerce market is expected to reach $111.4 billion by 2025 from $46.2 billion in 2020.
Notably, the company aims at expanding its fulfillment and storage capacity to 40% this year. Amazon already owns more than 60 fulfillment centers in the country. Its overall storage capacity spans more than 43 million cubic feet.
Apart from the latest move, the company launched two fulfillment centers in Maharashtra, out of which one is located in Mumbai, which will be primarily utilized for storing large appliances and furniture. Another fulfillment center is located in Pune.
The company recently made an announcement to open two fulfillment centers in Lucknow, Uttar Pradesh. The new facilities include a fulfillment center, and a specialized center for large equipment and furniture.
Amazon has launched a specialized fulfillment center in Gujarat, bringing an extra 1.4 million cubic feet of extra storage capacity. It has also expanded its existing fulfillment facility in the state.
Notably, the two fulfillment centers in Gujarat offer a storage capacity of 2.5 million cubic feet.
We note that Amazon remains well-poised to further penetrate the booming India e-commerce market with its continued investment in fulfillment centers, which are the giant warehouses that help online retailers store and ship products, and handle returns quickly.
Zacks Rank & Stocks to Consider
Currently, Amazon carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the retail-wholesale sector are Revolve Group, Inc. RVLV, The Kroger Co. KR and Walmart Inc. WMT. While Revolve Group and Kroger currently sport a Zacks Rank #1 (Strong Buy), Walmart carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rates for Revolve Group, Kroger and Walmart are pegged at 20.71%, 8.91% and 5.5%, respectively.
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