Walmart-Backed Flipkart Raises IPO Valuation Target To $60-$70 Bn; Likely To Go Public In 2023

Walmart-backed ecommerce giant Flipkart has recently raised its target for IPO valuation.

Flipkart has internally raised its IPO valuation to $60-$70 Bn and also planned to list on the US bourses in 2023 instead of this year, people who are privy to the matter told Reuters.   

The ecommerce giant is boosting its valuation by diverting its focus on new businesses–online healthcare services and travel bookings. 

It has launched the ‘Health+’ app this week and its travel business is also showing positive signs to them, according to the media report. 

People quoted above said that the ongoing global market turmoil sparked by the Russia-Ukraine crisis has also forced Flipkart to reconsider its timeline.

The increase in IPO valuation target comes at a time when Indian brick and mortar retailers protest against Flipkart and its rival, Amazon for bypassing federal regulations and favouring select sellers. The Indian government is also working upon on a slew of ecommerce regulations that could cause distress to foreign ecommerce giants. 

Founded by Sachin and Binny Bansal in 2007, Flipkart competes against the likes of Amazon, IPO-bound Snapdeal, social commerce giant Meesho.

In 2018, Walmart had acquired Flipkart for $16 Bn, valuing the Bengaluru-based company at $21 Bn. Then, Doug McMillion, president and CEO of Walmart, said that Flipkart would go public within four years of closing the deal.

Boosting Its Secondary Businesses

In fiscal 2020-21, Flipkart narrowed its losses by 22% from INR 3,150 Cr in FY 2020. It also increased its revenue by 25% from INR 34, 586 Cr ( in FY2020) to INR 43,356.5 Cr. 

In January 2022, Flipkart received an investment of $233 Mn (INR 1,736 Cr) from its Singapore holding company. As per the regulatory filing, it issued a total of 4,99,036 equity shares at an issue price of INR 34,800. 

Following this development, it announced plans to expand its grocery services to 1800 cities across India delivering across 10,000 pin codes in 23 states. To support this, it invested $145 Mn in Ninjacart in December last year as the investment would supplement its plans to scale its online grocery business. 

According to an Inc42 report, Flipkart Health, a health vertical of Flipkart, was in talks to acquire online pharmacy startup SastaSundar in November 2021. Then, it said it has signed definitive agreements to buy a majority stake in SastaSundar.

In April 2021, it acquired online travel aggregator ClearTrip entering the Indian hospitality sector. Then, Kalyan Krishnamurthy, CEO at Flipkart Group, said “Cleartrip is synonymous with travel for many customers, and as we diversify and look at new areas of growth, this investment will help strengthen our wide range of offerings for customers.”

All these deals and acquisitions are clear indicator of the ecommerce giant’s new focus on its secondary business verticals-travel, health and grocery.