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Flipkart looks to raise up to $1 billion in fresh funds

Parent Walmart to invest $600 million in first funding round since 2021, with new investors likely to pitch in with the rest of the amount

Flipkart looks to raise up to $1 billion in fresh funds
[Source photo: Chetan Jha/Press Insider]

E-commerce firm Flipkart is in talks to raise up to $1 billion in a fresh funding round, with parent Walmart investing $600 million, The Economic Times reported.

Flipkart will spend the money on growing its operations, strengthening its supply chain and boosting its technology capabilities, the report said.

Flipkart did not immediately respond to an email seeking comments.

Discussions are on with new investors who are looking to join the round, which could stretch up to $1 billion, the report said, citing unidentified people aware of the matter.

In July, private equity firm Tiger Global Management had exited Flipkart by selling its 4% stake to Walmart in a deal that valued the e-commerce company at about $35 billion.

The $35 billion valuation was down from the $38 billion that the e-commerce firm was valued at in its last funding round in 2021, when it had raised $3.6 billion.

Tiger Global had initially invested $8.6 million in a series B round in 2009 when the e-commerce firm founded by Sachin Bansal and Binny Bansal in 2007 was valued at $42 million.

The money manager later pumped in $1.2 billion between 2010 and 2015.

Tiger Global, in 2017, sold a part of its stake to SoftBank Group Corp, before Walmart acquired Flipkart by buying a 77% stake for $16 billion in 2018.

In its July transaction, Tiger pocketed about $1.4 billion for its 4% stake, taking the overall gains made from its investments in Flipkart to about $3.5 billion.

In another transaction, venture Capital firm Accel Partners also sold its 1% stake in the e-commerce firm to Walmart for $1 billion on an investment of $100 million.

Till November this year, startups in India raised about $7 billion, a 65.8% drop from the same period in the previous year, leading data and analytics firm GlobalData said.

“VC funding activity declined both in terms of volume and value, but the more prominent decline in terms of value suggest the prevailing harsh funding winter. The havoc funding winter has created in India is also evident from the fact that the total VC funding value is yet to touch the $10 billion mark,” Aurojyoti Bose, lead analyst at the analytics firm said.

In comparison, it took just four months to surpass the $10 billion-mark in total VC funding value last year.

India accounted for 5.5% of the total number of VC funding deals announced globally in January-November, while its share of the corresponding disclosed deal value stood at 3.1%.

Some of the biggest fundraising deals of the year include the $250 million funding in PhysicsWallah, $229 million worth of funding raised by Perfios Software Solutions, and $200 million fundraising by PhonePe.

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