Alibaba invests 845 million US dollars in Lazada's e-commerce platform.

DNHN - Lazada, which was founded in Singapore in 2012 and acquired by Alibaba four years later, is one of the region's leading e-commerce companies.

According to documents filed with Singapore's financial regulator, e-commerce giant Lazada received an additional $845.44 million from Alibaba, its parent company.

Alibaba and Lazada have not yet responded to these claims. This is the second time this year that Alibaba has invested in Lazada. Alibaba previously provided Lazada with more than USD 1.19 billion.

In 2022, the Chinese tech giant invested more than $1.6 billion in Lazada, signaling its intent to expand its e-commerce unit in Southeast Asia, where more than 460 million people are online.

Alibaba's international retail business is a significant contributor to its revenue. According to Alibaba's financial report for the first quarter of 2023, the sector's revenue increased by 41 percent to 13,967 million yuan ($2 billion) from 9,887 million yuan ($1.36 billion) during the same period in 2022.

This expansion is due to the sales of Lazada, AliExpress, and the Turkish e-commerce company Trendyol. Specifically for Lazada, this growth was driven by the first-quarter growth rates of money performance and order sales.

Southeast Asia continues to be a thriving market for e-commerce due to its large young population, growing internet popularity, and expanding middle class. According to Statista, the e-commerce market was worth $131 billion in 2022 and is projected to reach $211 billion by 2025.

Lazada, which was founded in Singapore in 2012 and acquired by Alibaba four years later, is one of the region's leading e-commerce companies.

In the e-commerce industry, Lazada is in direct competition with Shopee of Sea Limited.

Lazada has yet to surpass Shopee's dominance in Southeast Asia, however. According to a report by Momentum Works, Shopee's gross merchandise trade value (GMV) in 2022 is $47.9 billion, representing 48 percent of the region's total GMV. In contrast, Lazada only recorded a GMV of 20,1 billion US dollars, a nearly insignificant increase compared to 2021.

The company also faces increased competition from the TikTok Shop, whose GMV increased from $600 million in 2021 to $4.4 billion in 2018.

Indonesia, the largest market in Southeast Asia, has the most intense e-commerce competition in the region. Indonesia contributes approximately $2.5 billion to TikTok Shop's overall GMV.

Thu Phuong (t/h)