Indian e-commerce company Flipkart raised US$3.6 billion at a valuation of US$37.6 billion. Major shareholder Wal-Mart, together with SoftBank and Singapore’s sovereign wealth fund GIC, led the investment.
Flipkart’s opponents are Amazon and India’s richest man Mukesh Ambani (Chairman of Reliance Industries), because the country’s middle-class consumers quickly went online in the era of cheap data and after the pandemic.
In the latest round of financing, Wal-Mart-backed Flipkart is considering listing, while New Delhi is seeking to tighten e-commerce regulations.New rules propose to limit “flash sales” and may force Flipkart and Amazon to change their business structure once again.
The draft rule was released in June at a time when the government of India’s Prime Minister Narendra Modi was in a deadlock. fighting Discuss issues from foreign investment to freedom of speech with Big Tech.The government has been challenging Twitter And Facebook’s control and review of online content.
Flipkart said in a statement that the Canadian Pension Plan Investment Commission, the sovereign fund Qatar Investment Authority and Tencent participated in this round of financing. According to people familiar with the matter, Wal-Mart now holds approximately 74% of Flipkart’s shares.
Kalyan Krishnamurthy, CEO of Flipkart Group, said: “This investment by leading global investors reflects the prospects of digital commerce in India.” “We will focus on accelerating the growth of millions of Indian small and medium-sized enterprises.”
Three years after completely exiting and selling about 20% of its shares to Walmart, SoftBank reinvested US$500 million in Flipkart. Lydia Jett, partner of SoftBank Investment Advisers, said that SoftBank’s decision was driven by Flipkart’s ability to address “Indian consumer needs in the coming decades.”
Flipkart said it has more than 350 million registered users and 300,000 registered sellers, most of which are from India’s under-penetrated “second-tier” cities that are home to the emerging middle class that the company is trying to target.
The group also owns PhonePe, one of India’s leading payment applications, which is competing for dominance with India’s Paytm and Google Pay.
Amazon and Reliance have also been replenishing their funds. Reliance Retail, the retail arm of the Reliance Group, raised more than $6 billion last year to help drive its expansion into the e-commerce space.
Analysts predict that after other brands Zomato and Paytm, Flipkart may plan an IPO next year, and these two companies will be listed in the next few months.