The Flipkart Group, the Indian retailer partially owned by Walmart, raised $3.6 billion (U.S.) in new funding as it seeks to grow an e-commerce ecosystem in India. Lead investors include Walmart, GIC, Canada Pension Plan Investment Boards and SoftBank Vision Fund 2.
Other investments came from DisruptAD, Qatar Investment Authority, Khazanah Nasional Berhad, and marquee investors Tencent, Willoughby Capital, Antara Capital, Franklin Templeton and Tiger Global. Walmart said this new investment values Flipkart at $37.6 billion.
“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 maximize this potential for all stakeholders … 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,” said Flipkart Group CEO Kalyan Krishnamurthy.
Flipkart said the money will allow the company to continue making deeper investments across people, technology, supply chain and infrastructure to address the requirements of a rapidly growing consumer base in India. Funds will also go to supporting Flipkart’s fashion business working with the apparel industry and helping small businesses explore untapped opportunities that technology presents. Flipkart said it will also be expanding grocery and last-mile delivery programs with some of the funds raised.
“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,” said Judith McKenna, President and CEO, Walmart International. “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 Indian 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.”
Walmart CEO Doug McMillon has repeatedly said the investment in Flipkart is a long-term game and it is one of a few strategic plays the retail giant sees as essential for growth over the next decade.
With more than 350 million registered users in India, 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.
Flipkart’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, which, coupled with strategic warehouse infrastructure investments, is one of the group’s core strengths. 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. Flipkart also works with more than 1.6 million kiranas in India through its wholesale business and its last-mile delivery program.
Flipkart Group is also a majority shareholder in PhonePe, one of the leading payment apps in India with more than 300 million users, facilitating over 1 billion transactions per month, 80% of which occur in Tier 2 and 3 cities and beyond.