- Flipkart raising $1B, fueled by $600M from Walmart.
- Funding to value firm at 10% premium.
- Cash could counter rivals, drive profitability.
Flipkart is in talks to raise about $1 billion in fresh funding, with key backer Walmart committing $600 million to the round. The new capital could value the Indian e-commerce leader up to a 10% premium over its last $33 billion valuation.
Potential New Investors
Beyond Walmart, Flipkart’s latest round is expected to draw new investors onto its cap table, according to an Economic Times report. While confirming Walmart’s fresh $600 million injection, Flipkart said other details remain speculative.
Walmart acquired a 77% Flipkart stake in 2018 for $16 billion. After PhonePe was spun off last year, Flipkart was valued at $33 billion.
Recently, Walmart spent $3.5 billion purchasing shares from Flipkart investors Tiger Global and Accel.
Impact on Walmart
Flipkart results significantly sway Walmart’s quarterly earnings. Walmart said India sales slowed last quarter as Flipkart’s Big Billion Days event shifted from Q3 last year to Q4 in 2023.
However, Walmart expects the new timing to benefit its current Q4 performance. Despite top-line growth, losses continue mounting for Flipkart.
Expecting Profitability
Flipkart India, its B2B arm, saw net losses widen over 42% to $591 million in fiscal 2023, while its marketplace unit, Flipkart Internet, also widened losses last fiscal year.
The fresh $1 billion cash pile could provide Flipkart with ample resources to counter domestic rivals and expand to hit profitability.
