Flipkart plans to raise $10 billion through IPO, says report

Reports indicate that Flipkart might go for a public listing next year and Walmart plans to divest 25 percent of its stake in the ecommerce company

India’s leading ecommerce marketplace Flipkart, majority owned by global retailer Walmart, plans to raise around $10 billion for its initial public offering (IPO), according to a report.

A report in the Mint said, Walmart has already hired investment banker Goldman Sachs to explore the IPO and is planning to divest around 25 percent of its stake.

“Work on the IPO (initial public offering) is on in full swing and the advent of the pandemic has only hastened the process, given the spectacular surge in demand on e-commerce platforms," according to a person quoted in the report.

Earlier, in the month of September, a report from Reuters had said that Flipkart was looking to go public in early 2021 and the listing could be at a foreign location. This report said Walmart was looking at a valuation of $45-50 billion.

Flipkart Group CEO Kalyan Krishnamurthy — at YourStory’s flagship event TechSparks in 2019 — had said that his big dream was to take Flipkart to an IPO, or what he called ‘a real exit,’ in three years.

Walmart had acquired Flipkart in 2018 in a deal valued at $16 billion. This was one of the biggest acquisitions to date for the Indian startup ecosystem, but it also saw the exit of its founders – Binny Bansal and Sachin Bansal.

The valuation sought for Flipkart by Walmart will mean that it has doubled its acquisition value.

In July this year, Flipkart's valuation rose to $24.9 billion, after it raised $1.2 billion in fresh funding with Walmart as its lead investor. Recently, Walmart and Flipkart together had announced the divestment of its fintech business – PhonePe into a separate entity valuing it at $5.5 billion.

These developments also come in the backdrop of the recent draft regulations which allows for direct overseas listing by Indian companies.

As the leading ecommerce marketplace, Flipkart competes against players such as Amazon and Reliance in India.

Edited by Kanishk Singh


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