[Funding alert] Paytm Mall confirms investment from eBay for 5.5 pc stake at $3B valuation

Update: According to recent regulatory filing from Paytm E-commerce Private Limited, eBay has invested $160 million (around Rs 1,101 crore) in Paytm Mall.

American ecommerce giant, eBay is making an investment in Noida-based ecommerce firm Paytm Mall for a 5.5 percent stake in the company.

Sources close to the discussion told YourStory that the investment in Paytm Mall is expected to be to the tune of $170 million-$200 million, and the round values the ecommerce startup at $3 billion.

Additionally, the partnership will also allow eBay’s inventory to be sold on the Paytm Mall’s platform.

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Speaking about the investment in Paytm Mall, Jooman Park, eBay Senior Vice President, APAC, said, 

“We are deeply committed to India and believe there is huge growth potential and significant opportunity in this dynamic market. This new relationship will accelerate our cross-border trade efforts in a rapidly growing market, providing hundreds of millions of Paytm and Paytm Mall customers with access to eBay’s unparalleled selection of goods.”

The new relationship between the two companies benefits eBay sellers as well and provides them with the opportunity to reach new customers in a rapidly growing market while providing Paytm Mall customers a wide selection of global inventory that would normally be out of reach locally.

In the coming weeks, millions of products sourced from eBay sellers around the world will be available on the Paytm Mall shopping experience within the Paytm ecosystem.

Earlier this week, in a complimentary statement, Paytm Mall said that it is rapidly expanding its ‘Paytm Mall World Store’ which makes international brands available to Indian buyers at its platform. The assortment includes over two million SKUs from several geographies, including the US, Spain, Korea, Japan, and China.

Rudra Dalmia, Executive Director, Paytm Mall, added,

 “This new strategic collaboration will ensure Indian consumers are given greater access to eBay’s vast selection of inventory. We’re excited about this relationship with eBay as our cross-border partner and investor and believe together, we will provide buyers and sellers an unparalleled opportunity to discover, engage, and transact on our platform.”

This month, the Indian ecommerce company also said that it has reduced spends to Rs 40 crore on a monthly basis, including all costs. This amount stood at Rs 200 crore, last year, at its peak, according to sources.

Sources within the company also told YourStory that last financial year Paytm Mall’s GMV stood at Rs 13,000 crore and the company is now targeting Rs 17,000 crore in GMV, in a contribution-positive manner. (Contribution margin is revenue generated minus the loading cost of the customer and the marketing incentives.)

“We are excited about our new relationship with Paytm Mall. This reinforces our commitment to invest in India and complements our existing import, export, and domestic platforms,” added Park.

At present, Paytm Mall has close to 300,000 merchant partners and receives 225,000 orders per day, claim sources quoted above.  

Past investments

Paytm Mall isn’t the only Indian ecommerce company where eBay has made an investment.   

In mid-2013 and 2014, eBay had made successive investments in Indian online marketplace, Snapdeal.

However, the US-based ecommerce giant reported a loss of $61 million, last year, by writing down its investment in the trouble-torn Jasper Infotech Private Limited, the company that operates the Gurugram-based Snapdeal.

Again, in 2017, eBay Inc also secured a 5.4 percent ownership in Flipkart, and sold its Indian operations to the the ecommerce behemoth. Last year, eBay sold this stake to Walmart during Flipkart’s acquisition and earned $1.1 billion as a part of the sale proceeds.

eBay had then said that it will relaunch its India business, which it eventually did in January this year.

(Edited by Dipti Nair) 

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