Walmart is thinking of raising USD 2-3 billion for its subsidiary Flipkart at a valuation of over USD 40 billion.
Walmart is thinking of raising USD 2-3 billion for its subsidiary Flipkart at a valuation of over USD 40 billion to widen its product range in India stated a news report by Mint citing two sources with knowledge about the matter.
One of the two sources told Mint that on contrary to the previous round, Walmart might want to use this funding to entice strategic investors to Walmart-Flipkart. But Walmart-Flipkart is also willing to sell to sizable pure-play investment companies.
The first source requesting anonymity stated that Flipkart needs additional expertise and constant financial assistance to stay ahead of the nation’s e-commerce competitors. So Walmart is eager to bring in critical investors in Walmart-Flipkart.
Walmart is yet to issue an official directive about its most recent fundraising strategy Investment bankers look for strategic partners and significant international investors.
According to the report, Walmart is yet to issue an official directive about its most recent fundraising strategy Investment bankers look for strategic partners and significant international investors.
Flipkart, in July last year, had raised approximately USD 3.6 billion. According to the two sources mentioned above who spoke with Mint, approximately USD 700-800 million of this capital is estimated to be still available.
The first source, as quoted by Mint, said that the funds could be used to increase resources such as fulfilment centres like warehouses and storage, new staff and businesses, as well as prospective acquisitions in the Indian e-commerce market.
Flipkart’s present worth is over USD 40 billion, which may dilute roughly 7% if it raises as much as USD 3 billion.Â
According to those stated above, Flipkart’s present worth is over USD 40 billion, which may dilute roughly 7% if it raises as much as USD 3 billion. Since Walmart acquired a 77 percent interest for USD 16 billion in 2018, the e-commerce giant completed its first capital infusion round in July of last year, valued at over USD 37 billion.
The anticipated fundraising will assist Flipkart in building a war chest to compete with fierce rivals Amazon India, the Tata group, and Jio Mart from Reliance Industries.
Walmart chose not to comment in response to speculations. Flipkart spokeswoman said there are currently no such intentions, and the claims are false and speculative.
On the other hand, Walmart chose not to comment in response to speculations. According to a Flipkart spokeswoman, there are currently no such intentions, and the claims are false and speculative.
The investors in Flipkart’s previous funding round were GIC, the Canada Pension Plan Investment Board, Walmart, the parent company of Flipkart, and SoftBank Vision Fund 2. Besides, Qatar Investment Authority, DisruptAD, Khazanah Nasional Bhd, Tencent, Tiger Global, and Franklin Templeton were also among the participants.
Due to the government’s digitization push and the pandemic’s choice for online transactions, Flipkart and Amazon have grown in popularity among customers over the last three years.
Walmart has expanded to newer areas in India and added new categories of products since acquiring Flipkart. Flipkart, for example, now sells a whole variety of food and furniture on its marketplace. The e-commerce company has also constructed new warehouses to assist in faster delivery.
In 2018, Walmart spent over $16 billion to acquire nearly 77% of Flipkart, its largest transaction to date, and in that year, claimed that the company might go public in four years.
According to Reuters, Flipkart, an Indian e-commerce business, has boosted its IPO valuation target by approximately a third to $60 billion to $70 billion and anticipates listing in the United States in 2023 rather than this year.
Besides, Flipkart opened its first Northeast India grocery fulfilment facility in Guwahati in April 2022. According to reports, the centre was administered by women to help the career advancement of Flipkart’s female employees. [82] The Flipkart Foundation was created by the business in the same month to promote entrepreneurship and skill development in India’s underprivileged communities.
Flipkart entered the Non-Fungible Tokens (NFTs) and Web3 markets in 2022 by enabling Indian buyers of the Nothing Phone 1 to obtain the NFT through the app known as Nothing Community Dots. It is hosted by these NFTs using a polygon blockchain. The NFT drop took place at FireDrops, a FireDrops NFT marketplace powered by GuardianLink and operated by Flipkart.
Additionally, Flipkart developed a retail platform built in the metaverse called Flipverse in October 2022. People may shop and browse products more interactively thanks to the platform. The Flipverse was developed in collaboration with the polygon-incubated company eDAO, and it aims to offer users an experience that is similar to shopping at a real mall while also allowing them to design their own avatars.
Edited by Prakriti Arora
