Flipkart In Talks To Raise $3 Bn, Targets Valuation of $40 Bn

SUMMARY

Last week it was reported that Flipkart was seeking a valuation up to $30 Bn from this round

The fundraising plans for Flipkart comes at a time when Amazon is also infusing funds in its India entity to back the next phase of expansion

Last month, Walmart reported that Flipkart and its payments subsidiary PhonePe continued to experience “strong growth” in Q1 FY22 (February- April Quarter)

Walmart-backed Flipkart is in talks to raise at least $3 Bn from investors including SoftBank Group Corp. and several sovereign wealth funds, according to reports.

Last week, it was reported that after exiting Flipkart in 2018, Japanese conglomerate SoftBank Group Corp. is in talks with Flipkart to invest $700 Mn in the ecommerce marketplace again, according to reports. However, last week it was reported that Flipkart was seeking a valuation up to $30 Bn.

According to the new report, the Bengaluru based ecommerce marketplace is targeting a valuation of about $40 Bn and is in discussions with Singapore’s GIC Pte,, Canada Pension Plan Investment Board and the Abu Dhabi Investment Authority, people familiar with the matter told Bloomberg., asking not to be named because the discussions are private. SoftBank, which had previously backed Flipkart before selling its stake to Walmart, could invest $300 Mn to $500 Mn of the total through its Vision Fund II, one of the people said.

The fundraising discussions are not yet finalized and could still change, the people said. SoftBank and GIC declined to comment, while Flipkart did not immediately respond to requests for comment.

The fundraising for Flipkart comes at a time when Amazon is also infusing funds in its India entity to back the next phase of expansion. Amazon Seller Services, the marketplace unit of the US-based ecommerce giant Amazon, received a capital infusion of INR 915 Cr in May. The infusion was led by Singapore-based Amazon Corporate Holdings, with participation from the parent entity Amazon.com Inc.

The ecommerce market has boomed over the past 18 months, one of the clear beneficiaries of the pandemic. One of the most successful IPOs this year was South Korea’s Coupang Inc., another SoftBank-backed ecommerce provider. Last month, Walmart reported that Flipkart and its payments subsidiary PhonePe continued to experience “strong growth” in Q1 FY22 (February- April Quarter).

The company said, Flipkart continued to perform well driving strong and sustainable ecommerce gross merchandise value (GMV) growth even as the teams dealt with the challenges of resurging Covid cases in India. Flipkart’ IPO plans for 2021 have been slightly delayed due to the pandemic, now likely to be executed next year.