Amazon Considering India IPO, Looking To Spin Off Domestic Operations: Report

The company reportedly earlier invited eight to ten banks for an initial discussion, which included senior executives from both its Indian and US operations.

While an immediate shift to an inventory model remains unlikely for Amazon, spinning off its Indian arm and listing it locally could increase its domestic shareholder base.

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E-commerce giant, Amazon, is looking into the possibility of spinning off its Indian operations and listing them locally, media reports said. To assess its options, Amazon, which also holds the second-largest market share in India after Flipkart, reportedly engaged with multiple Indian investment banks while also consulting JP Morgan, its primary banker on Wall Street.

Citing sources in the know, YourStory reported that the US firm has initiated conversations with investment banks in the country. Quoting one of the sources, the report said, “Amazon has started discussions with bankers and is looking to spin off and list in India. The biggest reasons are data localisation and, more importantly, it can directly have inventory here."

Another source reportedly said that the company earlier invited eight to ten banks for an initial discussion, which included senior executives from both its Indian and US operations.

These discussions, however, remained in an early stage. The report noted that a company spokesperson declined to comment, stating that Amazon does not respond to "rumours and speculations."

Regulatory Challenges and Competitive Landscape

India’s existing e-commerce regulations permit only domestic firms to follow an inventory-based model, which allows businesses to manage their own stock, ensuring faster deliveries, stronger brand control, and lower logistics costs.

Foreign companies, however, must operate under a marketplace model, which restricts them to functioning as intermediaries between buyers and sellers. While an immediate shift to an inventory model remains unlikely for Amazon, spinning off its Indian arm and listing it locally could increase its domestic shareholder base. Over time, this could open avenues for majority ownership by Indian investors, the report noted.

This development surfaced shortly after Amazon underwent leadership changes in its Indian operations. Over the past few years, the company has struggled to maintain its footing, losing ground to Flipkart, which dominates nearly half of India’s e-commerce market.

Additionally, Amazon faces intensifying competition from Meesho, backed by SoftBank, which recently secured over $500 million in funding. The company also lagged in the quick commerce sector, launching its pilot services in India at a time when competitors such as Swiggy Instamart, Blinkit, and Zepto had already secured significant market presence.

Meanwhile, Flipkart, Amazon’s key competitor in India, has also initiated discussions with bankers regarding a potential listing in the country within the next 12 to 15 months. Media reports earlier indicated that Flipkart was working on shifting its domicile from Singapore to India, a crucial step before pursuing an IPO.