Flipkart investor Tiger Global cuts stake in Amazon by 2/3rd
The hedge fund has cut its exposure to 1.04 million shares worth over USD 618 million as of March 31, 2016, from 3.19 million shares worth USD 2.16 billion in the December quarter, according to a filing at the US SEC. The fund also entirely dissolved its stake in Alibaba Group Holding.
Besides, it has brought down its stake in Chinese e-tailer JD.com (by about 25 per cent) and Apple (over 46 per cent). Tiger Global has taken stake in Zillow Group, which provides real estate and mortgage information, valued at about USD 23.6 million at the end of the quarter.
Over the past few months, Flipkart has also faced a series of markdowns from its investors. A T Rowe Price-managed mutual fund had marked it down by 15 per cent in April while Morgan Stanley-backed mutual fund had done so by 27 per cent in February, according to reports.
Amazon India, Flipkart and Snapdeal are currently locked in a battle for market leadership in the burgeoning Indian e-commerce sector. The three firms have been aggressively spending billions of dollars on marketing, strengthening their supply chains and acquiring customers with predatory discounts. Tiger Global’s stake reduction comes at a time when Amazon is catching up in India while Flipkart is facing growing concerns about its valuation. At least four investors in Flipkart have marked down the value of their holdings in Flipkart; American mutual funds Fidelity Rutland Square Trust II and Valic Co were the latest to do so.
Tiger Global is one of the most prolific investors in Indian e-commerce firms, though it has slowed down a tad in recent months. The hedge fund also has exposure to another Flipkart rival, Shopclues, in which it led a $100 million funding round last year. It is also an investor in cab-hailing firm Ola and used-goods marketplace Quikr, among other Indian companies.
The hedge fund is one of the early backers of Flipkart, having invested for the first time more than six years ago. It has since participated in the Indian online retailer’s subsequent funding rounds. Tiger Global, along with Naspers, co-led Flipkart’s $1 billion funding round in 2014.