Flipkart likely to raise $1 billion ahead of IPO: Sources

Indian e-commerce giant Flipkart has hit the market to raise about $1 billion at up to $30 billion valuation in a pre-IPO financing round, sources said. Spare a few minutes to know more about it…

Funding opportunities

The Bangalore-based startup, which sold majority stake to Walmart in 2018, began first exploring funding opportunities with some investors earlier this year. In recent months, the company has also internally discussed pushing its public listing timeline to early next year, the sources added.
Several major investors of Flipkart declined to comment on fundraise talks early this month. One investor said it made sense that the e-commerce group was planning to raise some capital as the market currently has no shortage of it.

Great year for start-ups

Eleven Indian start-ups have turned unicorn this year, more than half of them last month, as some high-profile investors including Tiger Global and Falcon Edge double down on the world’s second largest internet market.
Flipkart, which was last valued at about $24.9 billion last year when it raised $1.2 billion in a round led by Walmart, hasn’t finalized the new investment and the deal size as well as the valuation may change, one of the sources said.

Millions of monthly users

In an earnings call in November last year, Walmart said Flipkart and its payments entity PhonePe had seen the number of monthly active customers reach an all time high. In an earnings call in March this year, Judith McKenna, President and Chief Executive Officer of Walmart International, said Flipkart’s GMV growth was impacted by a 53-day national lockdown in India in the first half of the last year.
“But the business rebounded and exited Q4 with strong momentum, delivering GMV growth roughly double that of the full year.

Business got hit during lockdown

India was hit by a second wave of the coronavirus in early April, which has again prompted some states to enforce restrictions on servicing of non-essential items on e-commerce platforms.
The Bangalore-headquartered firm competes neck to neck with Amazon in India. The American e-commerce group has invested over $6.5 billion in the South Asian market.
Both the firms are struggling to aggressively expand their footprint in India, where physical stores continue to drive the vast majority of retail sales. A new powerful player arrived in the market last year to further increase the competition.
Flipkart did not respond to a request for comment.

Keywords: chalgenius, start-ups, Flipkart, Bangalore, Amazon, IPO, South Asia

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