Indian e-commerce giant Flipkart recently said that it is raising $1.2bn in funding led by majority owner Walmart Inc. The investment, also funded by other existing shareholders, values Flipkart at $24.9 billion, and comes two years after U.S. retail giant Walmart bought the company from its founder for $16bn acquiring more than 70% stake.
Flipkart said it would use the funds, to be received in two tranches this fiscal year, to support the “development of its e-commerce marketplace as India emerges from the COVID-19 crisis.”
“We’re grateful for the strong backing of our shareholders as we continue to build our platform and serve the growing needs of Indian consumers during these challenging times,” said Flipkart Chief Executive Officer Kalyan Krishnamurthy in a statement.
“Since Walmart’s initial investment in Flipkart, we have greatly expanded our offer through technology, partnerships and new services. Today, we lead in electronics and fashion, and are rapidly accelerating share in other general merchandise categories and grocery, all while providing increasingly seamless payment and delivery options for our customers. We will continue innovating to bring the next 200 million Indian shoppers online,” he added.
Flipkart, which competes with Amazon in India, said its monthly active customers figure surged 45% in the financial year that ended in March this year, compared to the year before, and these customers are making 30% more transactions. The 13-year-old firm said it recently surpassed 1.5 billion visits per month.
Besides Amazon, Flipkart faces competition from local online grocery upstart JioMart, backed by billionaire Mukesh Ambani, in a key growth market for e-commerce.
Ambani’s Reliance Industries Ltd has received billions of dollars in recent weeks from major global firms for its digital arm, which is expected to roll out an online service for Indian grocers and small businesses.
JioMart, a joint venture between India’s largest retail chain Reliance Retail and Jio Platforms, launched earlier this year in select sub urban areas of Mumbai and has since expanded to more than 200 cities and towns across the nation.
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