MOSCOW (Reuters) - AliExpress Russia, an e-commerce venture between Chinese online shopping giant Alibaba and Russian partners, said it was aiming for annual turnover of $10 billion by 2022-2023, up from what analysts estimate is about $6 billion now.
Chief Executive Dmitry Sergeev, who did not give details on current turnover, told Reuters the company could consider an initial public offering (IPO) in three to four years, although he called the existing shareholding structure “optimal”.
“We are completely localising business and are building a separate company here,” Sergeev said in an interview, adding that this meant improving the Russian language search function and expanding the network of local sellers.
He said AliExpress Russia wanted to increase the share of Russian sellers on the platform to 50% by 2022-2023, adding that purchases from China now dominated business. He also said the firm aimed for 50 million customers a year.
The venture between Alibaba, the Russian Direct Investment Fund, mobile operator Megafon and internet firm Mail.Ru is one of several players expanding in Russia’s 2 trillion rouble ($28 billion) e-commerce market.
Experts from Moscow’s Higher School of Economics estimated the volume of goods shipped to Russians from abroad was worth $6.5 billion in 2019. A Russian Postal Service official said more than 90% of foreign shipments arrived from China, much of it driven by online orders via AliExpress Russia.
Sergeev said AliExpress Russia would invest in logistics in its effort to cut delivery times from China to 10 days from as long as 20 days now, saying this could be achieved with local Russian partners.
“I believe the value of owning the entire logistics infrastructure is overestimated,” he said, adding that there were a range of possible partners.
He did not rule out mergers and acquisitions, saying smaller players were likely to lose out as the marketed consolidated.
Reporting by Nadezhda Tsydenova; Writing by Alexander Marrow; Editing by Edmund Blair
Our Standards: The Thomson Reuters Trust Principles.