Walmart boosts Indian e-commerce giant Flipkart with $600 mn infusion in latest funding round
Flipkart
Walmart, the largest shareholder in Indian e-commerce powerhouse Flipkart, is gearing up to invest around $600 million in the latest fundraise for the start-up, according to a Flipkart spokesperson.
The move comes as part of Flipkart's ongoing discussions to secure a total of $1 billion in fresh funds, with new investors also in talks to join the funding round. The Economic Times, citing insiders, reported that the injection is expected to value Flipkart at a premium of approximately 5 per cent to 10 per cent above its current $33 billion valuation.
While the current funding falls short of the near-$38 billion valuation reached in 2021, it underscores Walmart's commitment to accelerating its growth in India.
In 2018, Walmart made a significant investment by acquiring a 77 per cent stake in Flipkart for about $16 billion, marking its most substantial investment at the time. In early 2020, Walmart further increased its control by purchasing the remaining stakes from hedge fund Tiger Global and venture capital firm Accel for $1.4 billion.
Flipkart, a leading online marketplace in India, has strategically focused on catering to small towns and cities, setting itself apart from its urban-centric rival Amazon. The infusion of funds comes as Flipkart aims to solidify its position in the competitive Indian e-commerce landscape.
Although the current valuation is expected to be a premium to the existing $33 billion, it falls short of the high of nearly $38 billion reached in the previous year.
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Walmart's consistent financial backing has contributed to Flipkart's growth in the Indian market. In 2022, Walmart's $600 million investment is anticipated to be a key factor as Flipkart adjusts its plans to go public, delaying the initial public offering (IPO) until 2023. Additionally, sources with direct knowledge of the plan reveal that Flipkart has internally raised its IPO valuation target to a range of $60-$70 billion.
(With inputs from Reuters)
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