Flipkart raises $3.6bn for close to $40bn valuation

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Indian ecommerce firm Flipkart has raised $3.6bn in funding for a valuation of $37.6bn, with major shareholder Walmart main the spherical alongside SoftBank and Singapore’s sovereign wealth fund GIC.

Flipkart is up in opposition to Amazon and India’s richest man Mukesh Ambani, the chair of Reliance Industries, for the nation’s middle-class customers, who’re quickly coming on-line within the age of low-cost knowledge and after the pandemic.

The most recent fundraising spherical comes as Walmart-backed Flipkart is contemplating going public and New Delhi is in search of to tighten ecommerce laws. The brand new guidelines suggest to restrict “flash gross sales” and will pressure Flipkart and Amazon to vary their enterprise construction once more.

The draft guidelines, launched in June, come at a time when Prime Minister Narendra Modi’s authorities is locked in a battle with Massive Tech on points starting from international funding to free speech. The federal government has been difficult Twitter and Fb over management and moderation of on-line content material.

Flipkart stated in a press release that the Canada Pension Plan Funding Board, sovereign fund Qatar Funding Authority and Tencent participated within the fundraising spherical. Walmart now holds a stake of about 74 per cent in Flipkart, in response to individuals with information of the transaction.

“This funding by main international buyers displays the promise of digital commerce in India,” stated Kalyan Krishnamurthy, chief govt of Flipkart Group. “We are going to deal with accelerating development for thousands and thousands of small and medium Indian companies.”

SoftBank reinvested $500m in Flipkart three years after exiting fully and promoting its stake of about 20 per cent to Walmart. Lydia Jett, associate at SoftBank Funding Advisers, stated SoftBank’s resolution was pushed by Flipkart’s capacity to deal with the “wants of the Indian client within the many years to come back”.

Flipkart stated it had greater than 350m registered customers and 300,000 registered sellers, the bulk coming from India’s underpenetrated “tier two” cities, house to the burgeoning center courses that corporations try to focus on.

The group additionally owns PhonePe, one of many main funds apps in India, which is competing in opposition to India’s Paytm and Google Pay for dominance.

Amazon and Reliance have additionally been replenishing their conflict chests. Reliance Retail, Reliance Group’s retail arm, raised greater than $6bn final yr to assist gas its growth into ecommerce.

Analysts predict that Flipkart may very well be planning an IPO for subsequent yr, following the trail of different marque Zomato and Paytm, that are going public within the upcoming months.

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