Mumbai: Walmart-owned Flipkart has raised $3.6 billion in new captions from its promoters and investors, SoftBank Group Corp., valuing the e-commerce firm at $37.6 billion, more than double that for which the US retail giant had bought 77 per cent stake in 2018. .
Investors in the latest funding include financial investors GIC, Canada Pension Plan Investment Board (CPP Investments), SoftBank Vision Fund 2 and Walmart as well as sovereign funds DisruptAD, Qatar Investment Authority, Khazana National Berhad and marquee investors Tencent. Willoughby Capital, Antara Capital, Franklin Templeton and Tiger Global.
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Commenting on the deal, Kalyan Krishnamurthy, CEO, Flipkart Group, said, “At Flipkart, we are committed to transforming the consumer internet ecosystem in India and providing access and value to consumers. This has been done by leading global investors. The investment reflects the promise of digital commerce in India and their belief in Flipkart’s capabilities to maximize this potential for all stakeholders.”
Like its rival Amazon, Flipkart began selling books, but quickly expanded into selling smartphones, clothing, and other items. Following the acquisition by Walmart, Flipkart expanded into several smaller towns and cities, added more items such as furniture and groceries to its online store, and increased its warehouses to compete with Amazon.com’s India unit.
Japan’s SoftBank, which previously backed Flipkart before selling its 20 percent stake to Walmart, is back as a shareholder.
“SoftBank’s re-investment in Flipkart is driven by our experience and conviction in the company’s management team to meet the needs of the Indian consumer for decades to come,” said Lydia Jett, Partner, SoftBank Investment Advisors.
Investors are pouring billions of dollars into India’s consumer internet and software-as-a-service startups that are thriving despite the COVID-19 pandemic.
Walmart has spun off payments arm PhonePe from Flipkart, a unit that could be valued at close to $10 billion, as parent firm plans an initial public offering (IPO) of Flipkart, valued by the e-commerce firm at $50 billion. More than. Analysts said the latest round of funding could pave the way for Flipkart to go public in the United States in 2022.
Flipkart, which has over 350 million registered users, has announced that it will increase investments in technology, supply chain and infrastructure as it focuses on categories such as fashion, travel and groceries.
“As we serve our consumers, we will focus on accelerating the growth of millions of small and medium Indian businesses, including Grocery. We will continue to invest in new categories and leverage India-made technology to transform consumer experiences and develop world-class supply chains.”
Rapid smartphone adoption and low-cost mobile data in India have helped digital startups sell everything from groceries and cosmetics to smartphones and vacations.
Several leading Indian startups have also announced plans to go public to capitalize on foreign fund liquidity. Food delivery startup Zomato, payment services Paytm, beauty brand Nykaa and ride-hailing app Ola are being closely monitored.
“Flipkart is a great business whose growth and potential mirror that of India as a whole – that’s why we invested in 2018 and continue to invest today,” said Judith McKenna, President and CEO, Walmart International.
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