Global investors’ confidence in digital commerce in India was once again in full display when the Flipkart Group, country’s homegrown consumer internet ecosystem, raised USD 3.6 billion in funding.
The round was led by financial investors GIC, Canada Pension Plan Investment Board (CPP Investments), SoftBank Vision Fund 2 and Walmart, along with investments from sovereign funds DisruptAD, Qatar Investment Authority, Khazanah Nasional Berhad, and marquee investors Tencent, Willoughby Capital, Antara Capital, Franklin Templeton and Tiger Global.
The investment values the Flipkart Group at USD 37.6 billion post-money.
Kalyan Krishnamurthy, Chief Executive Officer, Flipkart Group, said: “At Flipkart, we are committed to transforming the consumer internet ecosystem in India and providing consumers access and value.
“This 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. We will continue to invest in new categories and leverage made-in-India technology to transform consumer experiences and develop a world-class supply chain.”
The Indian ecommerce market has continued to accelerate over the last year when access to products safely and convenience took priority. With the funding, 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 India.
A key focus area for the Group is to help informal commerce segments leverage the power of technology. As one of the leaders in the fashion segment, this means working with the fashion industry and helping small businesses explore untapped opportunities that technology presents. Through its expanding grocery and last-mile delivery programs, the Group will also work with kiranas (neighbourhood grocery stores) to help them digitise and grow.
Softbank was making a return to Flipkart, having sold its shares to Walmart in 2018, and Lydia Jett, Partner, SoftBank Investment Advisers, said: “SoftBank’s re-investment in Flipkart is driven by our experience with and conviction in the company’s management team to continue addressing the needs of the Indian consumer in the decades to come.
“From our platform as one of the largest Asian eCommerce investors, SoftBank has a broad lens on the fundamental trends shaping digital commerce in the region. The opportunity to meet consumer demand for high-quality selection at low prices and a young population make online consumption critical to India’s quest for the ‘$5 trillion economy’ that Flipkart’s growth story has been enabling.”
Judith McKenna, President and CEO – Walmart International, said: “Flipkart is a great business whose growth and potential mirrors that of India as a whole – that’s why we invested in 2018 and why we continue to invest today.
“Kalyan and the team have put the Indian customer at the center of everything and they have continued to innovate in the categories and services customers want most, creating new jobs and growth opportunities for Indian entrepreneurs and small businesses alongside them. The quality of the investor group and valuation announced today is further confirmation of global confidence in Flipkart and its mission to transform commerce in India.”
With more than 350 million registered users from across the country, Flipkart has been investing in key categories, including fashion, travel and grocery, that reflect India’s maturing digital commerce industry.
Myntra, the Group’s fashion entity, is among the leaders in the category. It’s logistics and supply chain arm, Ekart, employs more than 100,000 people and makes deliveries to more than 90% of the addressable pin-codes in India. Venturing into the social commerce space, Flipkart recently announced the launch of Shopsy, which will encourage local entrepreneurship. More than 300,000 registered sellers from across the country are on Flipkart’s marketplace, and 60% are from tier 2 cities and beyond. The Group is also a majority shareholder in PhonePe, one of the leading Payments Apps in India with more than 300 million users, facilitating over 1 billion transactions per month.
