Flipkart to raise fresh capital for valuation of $10-12 billion

By

Maverick Martins

Published
Jan 30, 2017

India’s largest online retailer Flipkart is planning to cut its monthly expenditure to $20 million from the current $45 million as it looks to raise fresh capital of Rs 3,400-5,400 crore ($500-800 million), according to two people aware of the developments.

The company, which is keen to shore up its reserves, could settle for a valuation of $10-12 billion, according to the sources.

Flipkart had last raised capital in 2015 when it was at its peak for a valuation of $15.2 billion.

“Final valuation could change depending on investor interest and terms of the deal,” the people cited above told the Economic Times. They estimate that the company — which also includes fashion portals Myntra and Jabong, besides payments business PhonePe — will trim its monthly burn rate to about $20 million from about $45 million.

Flipkart declined to comment on the plans to trim costs and raise money at a lower valuation.

The developments come at a time when Flipkart’s talks with Walmart for a possible investment have failed to fructify, said two people aware of the details.

A spokeswoman for Walmart, who termed India an important market for the company, said, “We regularly meet with different companies in global retail markets, not all of those meetings lead to business transactions and we don’t share details of our discussions with individual companies.”