Flipkart ties up with Adani to set up logistics hub and data centre

Walmart owned e-commerce major Flipkart has tied up with Adani Logistics Ltd, a unit of Adani Ports and Special Economic Zone Ltd (APSEZ), to set up one of India's largest logistics hubs in Mumbai and a data centre in Chennai.

In a joint statement, the two companies told the media that Adani Logistics would build a 534,000 square feet fulfilment centre in its upcoming logistics hub in Mumbai and lease it to Flipkart.

The fulfilment centre, which is to be set up at the Adani Logistics hub in Mumbai, will be leased to Flipkart, while the proposed data centre is due to come up at AdaniConnecX's facility in Chennai, the companies said.

Flipkart will develop its third data centre at the AdaniConnecX facility to keep its data within India. AdaniconneX Private Ltd is a joint venture between US's EdgeConneX Inc and Adani Enterprises Ltd (AEL), the flagship-listed unit.

Expected to be operational in the third quarter of 2022, this warehouse can store 10 million inventory units, the alliance said.

For Flipkart, the alliance with Adani Group comes at a critical juncture as it battles increasing competition from the aggressive digital forays of India's largest business houses—Reliance Industries Ltd (RIL) and the Tata Group in addition to the challenge posed by rival Amazon.

The new fulfilment centre being planned is likely to be larger in area than the ones operated by Amazon in India so far, underscoring the market's potential size.

The tie-up marks Adani Group's entry into the three-way fight for domination of the Indian online shopping sector.

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