Flipkart Internet Secures $111 Million Investment from Singapore-Based Entities

 

Flipkart Internet, the marketplace arm of the renowned e-commerce giant Flipkart, has raised approximately INR 924 Crore (equivalent to $111 million) in two instalments from its affiliated entities headquartered in Singapore.

This capital infusion was confirmed through filings with the Registrar of Companies (ROC), indicating that the Walmart-backed e-commerce conglomerate received fresh investment from its related Singapore-based entities on January 8th.

The decision to infuse capital into Flipkart Internet was formally approved through resolutions passed on December 20th and December 22nd of the preceding year.

Initial reports on this significant development were first disclosed by ET (Economic Times).

Earlier speculation suggested that Flipkart was exploring the possibility of raising an additional $1 billion, with Walmart demonstrating a commitment of $600 million towards this endeavour. If realized, this fresh capital injection is anticipated to value Flipkart at a premium of 5% and 10% above its previous valuation of $33 billion.

However, while Flipkart has confirmed Walmart’s infusion of $600 million into the company, any further funding remains speculative.

In the previous year, Walmart further solidified its position in Flipkart by acquiring additional shares, acquiring Tiger Global Management’s stake for a significant sum of $1.4 billion, thereby facilitating the hedge fund’s exit from the company.

This funding news arrives when Flipkart is experiencing notable growth in its sales figures. The latest iteration of Flipkart’s Big Billion Days, which occurred in October of the preceding year, marked its largest-ever event, attracting approximately 1.4 billion customers over eight days.

Flipkart Internet predominantly generates revenue through commission charges and ancillary services provided to its network of merchants, including product advertising. Its operational revenue witnessed a substantial surge of 42% in the financial year 2022-23, soaring from INR 10,477.4 Crore in FY22 to INR 14,845.8 Crore in FY23.

Concurrently, Flipkart reported a 9% decrease in net losses, which declined from INR 4,419.5 Crore in FY22 to INR 4,026.5 Crore in FY23. Total expenditure for FY23 amounted to INR 19,043 Crore, with Employee Stock Ownership Plan (ESOP) costs accounting for INR 2,155 Crore.

In parallel developments, Flipkart’s formidable rival, Amazon India’s marketplace entity, Amazon Seller Services, has recently secured INR 830 Crore in funding from its parent companies based in the United States. Amazon Seller Services issued 830 million equity shares to Amazon Corporate Holdings Ltd and Amazon.com.inc as part of this capital infusion.