Amazon (AMZN), the world’s largest online retailer, has closed its acquisition of Axio, an Indian fintech non-bank lender, to offer loans straight to customers. The milestone comes after months of behind-the-scenes arrangements to finalize the deal.
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Under the terms of the deal, Axio will continue to operate as a separate business but will become a subsidiary completely owned by Amazon. The acquisition means Amazon now owns a direct lending license in India, one of the most populous nations in the world.
Amazon Seeks Stronger Foothold in India
The buyout completion comes several weeks after Amazon asked the Indian government to loosen the screws on its rules that prohibit international e-commerce companies from buying products directly from Indian sellers to ship them to customers across the globe.
Amazon, through Axio, will have to slug it out for market share with Flipkart, a top Indian e-commerce platform majority-owned by Walmart (WMT). Walmart is a major competitor to Amazon, especially in the US retail and e-commerce space.
Flipkart, earlier in the year, also secured its own non-banking lending license in India and, like Amazon, is targeting direct lending to retail customers and small businesses. However, Amazon is making headway and already has licenses to offer a mobile wallet solution and online marketplace insurance services in the country.
Meanwhile, the new acquisition is part of Amazon’s much broader global growth drive. In New Zealand, the e-commerce giant is pursuing the construction of AI data centers worth $4.4 billion. The American company is also seeking to accelerate the launch of its Kuiper satellite broadband services by going live in Vietnam. This could intensify competition with tech rival Elon Musk.
Will Amazon’s Stock Reach $300?
On Wall Street, Amazon’s stock holds a Strong Buy consensus rating, supported by 44 Buy and one Hold recommendations from analysts. The average AMZN price target is $264.13, indicating a potential 16.8% increase from its current price.
