Speaking on the sidelines of the St Petersburg economic forum, Alexander Shulgin said Ozon currently has a no more than 10% share of the fragmented Russian market.
The company raised 10 billion rubles ($154 million) in April from its largest shareholders, Russian conglomerate Sistema and private equity fund Baring Vostok, to build up its warehouse infrastructure, IT platform and financial services.
The decision about the IPO will also largely depend on new capital raising from shareholders, Shulgin added.
Ozon, which pioneered the Russian e-commerce sector in 1998 and is often referred to as Russia’s Amazon, does not see too many risks to its market share from a new Russian venture announced this week by Chinese e-commerce giant Alibaba, he said.
“The market is so big that we are still very far away from a war for territory,” he said.
Alibaba, which has had a presence in Russia for several years, finalised on Wednesday details of a joint venture with Russia’s sovereign wealth fund RDIF which will entail a $100 million investment from both.
Ozon has benefited indirectly from the Alibaba’s entry to the Russian market as this move has helped Russians to get used to online shopping in general, Shulgin said.
Ozon may raise further funds by issuing new shares, Shulgin said, with a $200-300 million fundraising possible in the near future, and another of a similar size potentially on the cards for later.
The company may attract investment from new foreign and Russian funds that are expressing an interest in e-commerce, the CEO said. Investment funds currently own about 20% of the company, while Sistema and Baring Vostok each hold 40%.
Ozon, which plans to keep the growth of its merchandise value at 70-80% in 2019, is currently loss-making due to active investment in its growth, CEO said.
He declined to comment on when the company would become profitable. It will be technically ready to turn its cash flow positive in two years, he said, but may decide not to do so if it prioritizes investing in growth instead.
Original article: Reuters