New Delhi: Homegrown e-commerce company Flipkart has raised $3.6 billion (about Rs 26,806 crore) in funding for a valuation of $37.6 billion, with its main owner Walmart joining SoftBank, Singapore's GIC Pte and several sovereign wealth and pension funds.
Tencent Holdings Ltd, Blackstone Group-backed Antara Capital, Abu Dhabi's sovereign fund ADQ, Qatar Investment Authority and Canada Pension Plan Investment Board (CPP Investments) participated in the funding round, Flipkart said.
The fresh funding ahead of a market-speculated IPO of Flipkart gives it the firepower to take on competition from well capitalised rivals such as Amazon Inc, billionaire Mukesh Ambani's JioMart, and the Tata Group.
While details about the investment made by these entities individually were not disclosed, sources said SoftBank has pumped in about $500 million. In a separate statement, CPP Investments said it has invested $800 million (about Rs 5,968 crore) in the Flipkart Group. According to sources, Flipkart will also undertake a buyback of employee stock options (ESOPs) worth about Rs 600 crore. Flipkart had raised $1.2 billion in a round led by Walmart last year that gave the company a valuation of $24.9 billion.
Walmart, which had in 2018 had invested $16 billion for acquiring a 77 per cent stake in Flipkart, is now estimated to hold about 74 per cent in the firm. In its statement on Monday, Flipkart said the current funding round has seen participation from sovereign funds DisruptAD, Khazanah Nasional Berhad as well as marquee investors Willoughby Capital, Franklin Templeton and Tiger Global and that it valued the Flipkart Group at $37.6 billion post-money.
Flipkart will continue to make deeper investments across people, technology, supply chain and infrastructure to address the requirements of a rapidly growing consumer base in the country, it added. With this deal, SoftBank is re-entering Flipkart's cap table. SoftBank had sold its approximately 20 per cent share when Walmart bought a 77 per cent stake in Flipkart for $16 billion in 2018.
"This (latest) investment by leading global investors reflects the promise of digital commerce in India and their belief in Flipkart's capabilities to maximise this potential for all stakeholders. As we serve our consumers, we will focus on accelerating growth for millions of small and medium Indian businesses, including kiranas," Flipkart Group Chief Executive Officer Kalyan Krishnamurthy said.
He added that Flipkart will continue to invest in new categories and leverage made-in-India technology to transform consumer experiences and develop a world-class supply chain. Post this round, Flipkart now ranks among the top 10 tally of global e-commerce companies in terms of market cap. This list includes names like Amazon, Alibaba and Shopify, among others.
Founded in 2007, the Flipkart Group includes Flipkart, fashion specialty site Myntra and Ekart (logistics and supply chain arm). The Group is also a majority shareholder in digital payments platform, PhonePe.
E-commerce has witnessed massive growth in the country over the past few years. The pandemic has further bolstered growth as containment measures introduced millions to the convenience of online shopping, while prompting seasoned online shoppers to buy more.